Philippines: Manufacturing PMI edges down in July but remains in expansionary territory
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, edged down to 50.4 in July, following June’s 50.8. That said, the PMI remained above the crucial 50-threshold, signaling a mild improvement in manufacturing sector conditions compared to the previous month.
July’s deteriorated was largely attributed to ongoing contractions in output and new orders, with the former dropping for the fourth successive month, due to weak domestic demand. Against this backdrop, firms reduced their staffing levels for the 17th month running. However, improved global economic conditions sustained export orders, which declined only marginally, while manufacturers grew more optimistic with regards to output expectations over the 12 coming months.
On the price front, albeit softening from the prior month, the introduction of a VAT tax for some goods and increased costs for raw materials kept input cost inflation elevated. Similarly, output cost inflation moderated from June but remained high nonetheless.