Philippines: Manufacturing sector shows modest improvement in February
The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) rose to 51.0 in February from 50.9 in January. As a result, the index moved further above the 50.0 no-change threshold, and signaled a faster improvement in manufacturing sector operating conditions compared to the previous month.
February’s uptick was primarily driven by a significant rise in new orders, both domestically and through a renewed increase in export sales, marking the first rise in foreign demand since last November. The sector also saw the first month of job creation since last October, with the rate of job creation being the sharpest in 16 months. However, material shortages slowed the growth in output to near-stagnation, the weakest rate observed in one-and-a-half years.
Material shortages also led to increased pressures on supply chains, contributing to higher material costs, rising supplier prices, and a slight uptick in both input price and output charge inflation in February. Moreover, these challenges negatively impacted business confidence, leading to a notable weakening in the 12-month outlook for production.