Philippines: Manufacturing PMI increases in March
The S&P Global Manufacturing Purchasing Managers’ Index (PMI) came in at 53.2 in March, up from February’s 52.8. Consequently, the index moved further above the 50.0 no-change threshold, signaling a faster improvement in business conditions compared to the previous month.
The Filipino manufacturing sector continued to ride the wave of demand surging from the recent relaxation of Covid-19 restrictions. Output and new orders continued to grow, with the former expanding at the joint-fastest pace since July 2019. Stronger demand was driven by domestic clients, with new export orders falling in March amid weakening global economic momentum. Meanwhile, the war in Ukraine cast its shadow over the sector: Raw materials shortages and rising energy costs causing input and output inflation to reach the highest level on record. Supplier delivery times increased at a faster rate and employers reduced their workforces in a bid to cut rising costs. Nonetheless, firms remained “strongly positive” amid loosened Covid-19 restrictions, according to the PMI press release.
S&P Global’s Maryam Baluch noted the headwinds posed by worsening external economic conditions:
“Whilst the country recovers from the pandemic, with alert levels downgraded and restrictions eased, international concerns and supply-side performance constrained the momentum of growth […] The war in Ukraine, Covid-19 cases rising in China, scarcity of materials and supply bottlenecks led to further worsening of supplier delivery times.”