In May, a slight deterioration in business conditions was observed in the manufacturing sector. The value of the IRG SGH industrial confidence indicator (IRGIND) fell by 0.6 pts month-on-month. This decline is due to the anticipated decrease in production levels in the coming months and an increase in finished goods inventories. The IRGIND currently stands at 1.6 pts, 1.8 pts higher than a year ago.
Last month’s forecasts came true – all key balances increased, with the exception of the balance for export orders (May was another month of decline in their volume). Pressure for price increases on finished goods eased (compared to April). The financial situation of manufacturers and their assessment of the overall economic situation in the country have improved very significantly – the balance of responses to the latter question reached its highest level since June 2019. The optimism among producers, which was strongly evident in the survey results from a month ago, has faded. The coming months are unlikely to bring any significant change in the situation in the processing industry.
Researcher:
Konrad Walczyk, kwalcz1@sgh.waw.pl