Polish manufacturing sector is optimistic about 2026

Current situation in Polish manufacturing below expectations

Polish manufacturing PMI fell from 49.1 pts in November to 48.5 pts in December, coming in below the market expectations (49.0 pts) and in line with our forecast. What pushed the index down was a lower contribution of 2 out of its 5 components (current output and new orders), while a stronger contribution of inventories, employment, and delivery times had the opposite effect. This means that the PMI remained below the 50-point mark separating growth from contraction for 8 consecutive months.

Decline in new orders deepens considerably

Particularly notable about the data breakdown is an acceleration in current output decline seen along with a stronger, compared with November, drop in new orders. Foreign orders also went down, and some of the surveyed companies linked the contraction to a weak demand in Germany and France. We believe that the poorer outlook for new orders, including those coming from abroad is connected with the growing competition from China, which diverts its exports to other markets amid difficulties in selling its goods to the US (see MACROmap of 15/12/2025). Due to the weakening demand, the enterprises were reducing their stocks of both final and intermediate goods in December.

Polish manufacturing sector is optimistic about 2026

The index value for expected production over a 12-month horizon increased in December to its highest level since March 2025, and remains markedly above the 50-point threshold. The surveyed companies linked their optimism to the expected improvement in market situation, business development projects, and new customers. Their optimism is also reflected in the “employment” component rise. Though it remains below the 50-point mark, the decline in employment has clearly slowed over the past couple of months.

Our GDP growth forecast remains unchanged

The average Polish manufacturing PMI increased from 46.8 pts in Q3 to 48.8 pts in Q4. Nonetheless, we stand by our forecast that Poland’s GDP growth did not change between Q3 and Q4 (3.8%), and that it reached 3.6% in 2025, up from 3.0% in 2024.

In our opinion, today’s publication of the PMI is neutral for the PLN and the yields on Polish bonds.