Colombia: Manufacturing PMI falls in May but remains in expansionary territory
June 4, 2019
Business conditions in Colombia’s manufacturing sector improved again in May but at a softer rate compared to April. The seasonally-adjusted Davivienda manufacturing Purchasing Managers Index fell to 50.8 from 51.0 in the previous month, thus remaining above the critical 50-point threshold separating expansion from contraction. The index moved above the crucial mark after a run of losses in Q1, when the index remained below the threshold.
Output climbed on higher demand and productivity gains, while new orders rose at a slightly faster rate as some firms expanded their market share and launched new products. Despite the upturn in production, employment levels were unchanged as some firms hired more workers, while others kept their payroll numbers stable or saw them decline. On the price front, shortages of raw materials and a strong U.S. dollar pushed up input costs, which prompted manufactures to raise output prices. Meanwhile, business confidence regained lost ground after falling to a four-month low in April on projections of stronger demand.
Author: Nihad Ahmed, Economist