BCR Romania Manufacturing PMI® at record low, as business conditions deteriorate for Romanian manufacturers at the start of 2025
Production volumes fall at quickest rate on record (since July 2023) - Softer drop in new orders signaled - Sharp decrease in purchasing activity supports stock reduction
- Production volumes fall at quickest rate on record (since July 2023)
- Softer drop in new orders signaled
- Sharp decrease in purchasing activity supports stock reduction
The latest BCR PMI® data showed the decline in the Romanian manufacturing sector deepening. Operating conditions deteriorated to the largest extent across the survey history to-date in January, with the pace of decline overtaking December's recent record. Despite a softer fall in new orders, output volumes were lowered at a survey record pace, which triggered an equally sharp decrease in input buying. Challenging conditions failed to dampen firms' confidence in the outlook for output, which rose to the highest level seen since June 2024.
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.
From 46.4 in December, to 46.1 in January, the headline PMI ticked down slightly to post a new survey low and the largest deterioration in business conditions on record. Faster falls in output and stocks of purchases, as well as reduced pressure on supply chains (suppliers' delivery times) contributed to the drop in the headline index in January.
Reflective of muted demand and tight customer budgets, Romanian manufacturers' order book volumes fell again in January. The rate of contraction slowed at the start of 2025 was nevertheless steep and elevated by historical standards. Likewise, manufacturers in Romania also signalled a softer decline in export sales in January. The speed of contraction was only modest and among the softest on record.
Output volumes were scaled back at a sharper rate in January, amid reports of demand weakness and challenging economic conditions. The rate of reduction was marked and ticked up to its strongest on record (since data collection began in July 2023).
The downturn in buying activity also gained slight momentum in January. The rate of contraction was strong and among the sharpest on record (only outpaced by February and August 2024).
Firms therefore relied upon their stocks of warehoused inputs to support production requirements. Thus, pre-production inventories were depleted to a stronger degree and one that was the jointfastest across the survey history (equal to July 2024).
With less strain on supply chains, the decline in vendor performance was less pronounced in January. Where lead time did lengthen, companies frequently attributed this to shortages at suppliers.
