Philippines: Manufacturing PMI hits highest reading since March in September
The IHS Markit Manufacturing Purchasing Managers’ Index (PMI) rose to 50.9 in September from August’s 46.4. September’s result marked the best reading since March. As a result, the index rose above the 50-threshold, signaling an improvement in business conditions from the previous month.
The higher reading mainly owed itself to a reduction in the rate of decline in output and new orders, as well as of employment. Inventory increases, following a decrease in August, also boosted the reading. A gradual reduction in Covid-19 restrictions largely drove the improved figures. Meanwhile, delivery times lengthened notably, driven in part by ongoing global supply shortages. On the price front, input price inflation moderated, but remained at elevated levels, while selling prices increased. Finally, firms’ expectations increased amid an improving vaccination rate, though they remained subdued nonetheless.
IHS Markit’s Shreeya Patel commented on the reading:
“After a tough trading period in August, manufacturers in the Philippines welcomed the relaxation of some virus-related restrictions. A number of factories and businesses resumed their operations, however, the domestic and international demand environment remained challenging. Job shedding persisted, but anecdotal evidence highlighted that this was mostly voluntary. Nevertheless, backlogs fell solidly which could result in efforts to rein in spending and cut headcounts until demand for Filipino manufactured goods improves.”