Korea: Manufacturing PMI deteriorates in March
April 1, 2022
The S&P Global Manufacturing Purchasing Managers' Index (PMI) came in at 51.2 in March, down from February's 53.8. As a result, the index remained above the 50.0 no-change threshold, pointing to a continued, albeit moderating, improvement in business conditions from the previous month.
March’s print, the lowest since November, was driven by a contraction of output—the first in three months—and close to zero growth of new orders—the joint-smallest increase in 18 months. Demand was hit by supply disruptions, while exports growth fell to the lowest level since July 2020 amid the global economic fallout arising from the war in Ukraine. Despite souring slightly, Korean manufacturers’ sentiment remained optimistic about the outlook for output ahead, amid hopes that price pressures plus supply bottlenecks would ease and thus boost demand.
Commenting on ongoing strong price pressures, Usamah Bhatti, economist at S&P Global, said:
“Higher oil, metals and semiconductor prices meant that the disruption was broad-based across the manufacturing sector. Rising raw material prices also meant that input price inflation accelerated to a three-month high.”