Central Europe: Is manufacturing past its peak? - BNPP

Softer manufacturing PMIs as well as other leading indicators for industrial sectors in Central Europe suggest weaker output growth across the region in the coming months, according to the analysis team at BNP Paribas.

Key Quotes

“The decline in PMIs has been largely driven by forward-looking components such as export orders, which may reflect deteriorating external competitiveness of regional manufacturers.”

“Weakening external competitiveness could be a result of recent currency appreciation or rising unit labour costs across Central Europe.”

“Alternatively, since Central European firms are part of the Western European global value chain, weaker export orders may eventually foretell slowing demand from abroad.”