Czechia Manufacturing Growth Remains Strong

The Czech Manufacturing PMI fell to 53.5 in September 2026 from 54.1 in August, below the expected 53.9, but still signaled a solid improvement in operating conditions. Output and new orders continued to rise, although growth eased from August. New export sales also expanded at a slower pace. Employment recorded its strongest increase since April 2022 as firms expanded capacity to meet higher production requirements. Backlogs rose for the ninth consecutive month, while supplier delivery times deteriorated at the fastest pace in three months amid transportation delays, material shortages and vendor capacity constraints. Input cost inflation accelerated, driven by higher energy, fuel and supplier costs, while output-price inflation slowed to its weakest since January. Purchasing activity increased, but inventories declined, with stocks of purchases falling for the first time since February. Business confidence stayed positive overall, despite dips.

The Czech Manufacturing PMI rose to 54.1 in August 2026 from 52.2 in July, marking the strongest improvement in operating conditions since April 2022. Growth accelerated in output and new orders, with new business rising at the fastest pace since February 2022, supported by stronger international demand. New export sales also increased at a solid pace, though growth eased from July. Employment resumed growth as firms responded to stronger demand, while backlogs accumulated at the fastest pace since December 2021 amid worsening supplier delays, material shortages and logistics issues. Input cost and selling-price inflation eased but remained elevated. Firms increased purchasing and safety stocks, while finished-goods inventories declined. Business confidence also strengthened to a five-month high, supported by expectations of stronger demand and planned machinery investment.

The Czech Manufacturing PMI fell to 52.2 in July 2026 from 53.9 in June, which marked the highest level since April 2022. The latest reading was the joint-softest since February (alongside May 2026), reflecting slower growth in both output and new orders compared with June. Still, new orders continued to be supported by foreign demand, with new export sales rising at the fastest pace since August 2021. However, pressure on balance sheets reportedly led firms to limit increases in input buying and pre-production inventories, while also contributing to a renewed decline in employment. Backlogs of work continued to accumulate at a solid pace as supply chain pressures persisted, although their severity eased. On the cost front, both input cost and output price inflation moderated in July but remained historically elevated, as the prices of key inputs, including metals and chemicals, continued to rise sharply. Business confidence fell to a three-month low but remained historically elevated.