Emerging Europe manufacturing PMI declined slightly in May to a weighted average of 49.5 from 49.9 in April. The decline reflects mixed directional moves with Russia and Poland PMI declining, while Turkey, Hungary and Czech Republic PMI increased. Russian PMI shrank to 47.6 from 48.9 pushing the headline down to its lowest level since 2009. Declines in output, new orders and employment suggest weakening domestic demand is causing the recession to deepen. Turkish PMI rose unexpectedly to expansionary territory for the first time since December 2014, to 50.2 in May from 48.5 in April, notes Barclays. Increases in new export orders, new orders and output led the improvement.
In Central Europe, CEE-3 manufacturing PMI decelerated for the fourth consecutive month to 53.6 in May from 53.8 in April. Poland PMI caused the decline, falling substantially to 52.4 in May from 54.0 in April. This was in line with a pullback in Germany May PMI. While most indicators declined, employment remained high as the overall indicator remained well in expansionary territory. Manufacturing PMI rebounded in Hungary and Czech to above 55, suggesting continued strong growth.
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