Colombia PMI March 2021

Colombia

Colombia: Manufacturing PMI rises in March

April 5, 2021

The seasonally-adjusted Davivienda manufacturing Purchasing Managers’ Index (PMI) rose to 52.4 in March, following February’s 50.2. As a result, the PMI moved further above the 50-threshold, indicating a healthy improvement of operating conditions in the manufacturing sector, compared to the previous month.

March’s upturn was chiefly driven by rebounding new orders and output, amid improved demand conditions and renewed clients’ stockpiling. Moreover, staffing levels rose for the second consecutive month, while firms remained optimistic regarding output in the coming year, amid hopes of a quick end to the health crisis. Regarding prices, input cost inflation accelerated to a 10-month high, amid supply shortages, resulting in higher output charges, as manufacturers hiked their selling prices at the sharpest rate in more than four years.

Andrés Langebaek Rueda, chief economist bolivar group at Davivienda, said:

“Among the variables surveyed, the cost of inputs draws much attention. As a result of the greater devaluation of the peso so far in 2021 and the increase in raw material costs in international markets, it was observed that the acceleration in the prices of these goods was the greatest in recent months. This increase, much higher than that for finished product prices, indicates a significant deterioration in producers' margins.”

Industrial production is seen growing 7.0% in 2021, which is up 0.8 percentage points from last month’s forecast. In 2022, our panel sees industrial production growth at 3.5%.


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Colombia PMI March 2021

Note: Purchasing Managers’ Index. Readings above 50 indicate an overall increase compared to the previous month and readings below 50 an overall decrease.
Source: Davivienda and IHS Markit.


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