Improvement in Polish manufacturing
Polish Manufacturing PMI rose from 48.3 pts in August to 49.0 pts in September, coming in line with our forecast, and above the market consensus (48.7 pts). The improvement in the index reflected higher contributions from 4 of its 5 components: new orders, current output, stocks of purchases and employment. The contribution from delivery times moved in the opposite direction, weighing on the headline PMI. The PMI has now remained below the 50-point mark separating growth from contraction for 17 consecutive months.
Faster decline in export orders
Particularly noteworthy about the September PMI data structure was the marked acceleration in the decline in new export orders, which have been falling continuously since December 2025 despite the significant rise in orders and output reported by last week's PMI surveys for the Eurozone and Germany (see MACROmap of 28/09/2026). This signals that the factors supporting the recovery in Eurozone manufacturing activity to date, such as precautionary inventory accumulation amid persistent disruption to supply chains from the Middle East, growing demand for artificial intelligence-related technologies and increased equipment orders resulting from higher defence spending, have not contributed to a marked improvement in conditions in Polish manufacturing. At the same time, September PMI data pointed to a further decline in total new orders, although the pace of contraction was slightly slower than in August. The continued decline in new orders weighed on current output. However, the pace of decline moderated relative to August and, as in previous months, was partly offset by the completion of backlogged work.
Faster growth in output prices
Average delivery times lengthened to a lesser extent in September than in August, which may point to easing supply chain disruptions linked to the conflict in the Middle East. Another encouraging signal was the slower increase in production costs compared with August. According to surveyed firms, cost pressures continued to reflect higher prices for raw materials, energy, fuels and transport resulting from geopolitical disruptions. Despite the slower rise in production costs, output price inflation accelerated. This suggests that the reduction in margins reported in the August survey as a factor limiting price increases was only a minor adjustment with little impact on output prices. In turn, this means that the pro-inflationary effects of the conflict in the Middle East may intensify in the coming months, resulting in higher core inflation.
Weaker demand and higher costs weigh on employment
September PMI data pointed to a further decline in employment in Polish manufacturing. However, the employment component increased markedly and reached a level only slightly below the 50-point threshold. According to the surveyed companies, lower employment reflected both voluntary departures and efforts to reduce headcount amid weaker demand and rising production costs. September PMI data therefore confirms that the process of “soft restructuring” remains under way in Polish manufacturing, aimed at improving productivity against a backdrop of continued wage pressures, higher production costs and intensifying competition from imports from China (see MACROmap of 28/09/2026).
The outlook for demand improves
In September, the index measuring output expectations over the next 12 months increased again, markedly increasing 50 pts, and coming in only slightly below the local peak recorded in May this year. When assessing the outlook, surveyed firms pointed to an expected improvement in demand, expansion plans and the launch of new products. Both the increase and the relatively high level of the future output index indicate that the escalation of the conflict in the Middle East, together with the associated supply-chain disruption and increase in cost pressures, did not contribute to a deterioration in assessments of the short-term outlook for output in Polish manufacturing. The moderately optimistic tone of the September PMI survey is also supported by inventory data. According to the survey, the inventories increased for a second consecutive month, this occurring for the first time since 2022. This may be interpreted as a signal that output will increase in the coming months. This interpretation is underpinned by the slower lengthening of delivery times noted above, suggesting that precautionary inventory building in response to supply chain disruptions is now playing a less important role.
In our view, today’s PMI data is slightly positive for the PLN and yields on Polish bonds.
