Korea: Manufacturing PMI rises to near-decade high in January
The IHS Markit manufacturing Purchasing Managers’ Index (PMI) increased to 53.2 in January from 52.9 in December, moving further above the 50-threshold that separates an improvement from a deterioration in the manufacturing sector over the previous month, and marking an almost 10-year high.
The uptick came amid a faster increase in manufacturing output, stemming from solid internal and external demand as key industries such as automobiles and technology were vibrant. Meanwhile, input purchasing activity saw the fastest rise in over a decade as firms moved to counter increasing supply chain disruptions, which resulted in longer lead times on delivery. However, employment declined, harming capacity and prompting backlogs to increase for the third consecutive month. On the price front, input costs rose at the fastest pace in three years, with firms transferring the impact through higher output prices.
On the outlook, Usamah Bhatti, economist at IHS Markit, commented:“Manufacturers in South Korea continued to signal strong optimism for the year ahead, as the impacts of Covid-19 dissipate further, and demand for new products gathers momentum.”