BCR Romania Manufacturing PMI: Strongest improvement in Romanian manufacturing performance in survey history in May
Output and new order growth rates quicken - Supplier performance worsens further - Inflationary pressures strengthen
- Output and new order growth rates quicken
- Supplier performance worsens further
- Inflationary pressures strengthen
The Romanian manufacturing sector's performance improved further and to a greatest extent on record (since July 2023) in May, according to the latest BCR PMI® data. Output and new orders signalled faster upturns as demand conditions strengthened. In turn, companies stepped up their input buying and engaged in another month of job creation, albeit one that was only fractional amid staff shortages. Supplier delays remained, however, with lead times lengthening sharply.
Meanwhile, input costs rose at a faster pace, as inflation regained momentum. Firms raised their selling prices in response, and at a quicker rate.
The headline BCR Romania Manufacturing PMI® is a composite single-figure indicator of manufacturing performance derived from indicators for new orders, output, employment, suppliers’ delivery times and stocks of purchases.
A PMI reading above the 50.0 no-change mark signals an improvement in the health of the sector over the month, while a figure below 50.0 points to a deterioration.
At 52.0 in May, the headline figure ticked up from 51.5 in April and was the highest since data collection began in July 2023. Romanian manufacturers indicated a modest upturn in the health of the sector.
Output levels at Romanian manufacturers increased for the second time in as many months in May, as greater new order intakes led to a boost in production. The rate of growth quickened to a solid pace that was the fastest in almost a year of data collection.
Stronger demand conditions supported a sharper rise in new sales at Romanian goods producers in May. The solid increase in new orders was the quickest on record, as customer referrals led to new client wins.
External demand conditions fared less well, as a subdued sales environment in key export markets led to a further drop in new export orders. The rate of decline eased to the weakest in the 11-month series history, however.
At the same time, greater demand for inputs following the first increase in purchasing activity on record, the re-routing of shipments from Asia due to disruption in the Red Sea and supplier capacity issues led to a steep lengthening of suppliers' delivery times in May. The extent to which delays worsened was the greatest since data collection for the series began.
Subsequently, Romanian manufacturers saw only a fractional fall in inventory levels, as firms sought to build safety stocks of inputs.
