Poland's Purchasing Managers' Index (PMI) grew to 47.2 points in June 2020 from 40.6 points in May, the economic research company IHS Markit reported on July 1. Analysts surveyed by PAP news agency expected 46.3 points.

In April the gauge of manufacturing index tumbled to an all-time low of 31.9 points. Even with the rebound, the PMI remained below the 50-point line separating contraction from growth for the 20th straight month, the second-longest downturn in the 22-year survey history.

The June reading was the highest in four months but by remaining below the breakeven 50 point indicates a challenging business environment in the manufacturing sector as demand and capacity utilisation remained weak amid the ongoing coronavirus (COVID-19) crisis.

The manufacturing sector was still contracting in June but economic conditions improved due to the lifting of restrictions imposed on the economy during the coronavirus pandemic, IHS Markit said in a comment

Manufacturing and new orders indicators rose rapidly, reaching levels from before the coronavirus crisis, Markit added. The pace of employment decline has subsided. Backlogs and purchasing declined more slowly and Polish manufacturers showed more optimism concerning production over the 12-month horizon, it added. 

"The Polish PMI made further strides toward the 50.0 stabilisation mark in June, but manufacturing conditions remain challenging even as the sector moves past the worst phase of the lockdown," commented Trevor Balchin, economics director at IHS Markit.

"While some may be surprised that the headline figure has not soared into growth territory following the collapse in activity witnessed in the spring, it should be remembered that the manufacturing sector was experiencing deteriorating conditions well before the coronavirus crisis took hold – the PMI has languished below 50.0 since November 2018, the longest downturn in over 17 years.

"All the key indicators showed notably slower falls in June, and output expectations turned decisively positive, albeit at a weaker level than the pre-crisis trend."

Current forecasts expect the Polish economy is going into a recession of 4-5% in 2020. Poland’s GDP expanded 4.1% in 2019, easing from 5.1% the previous year.