Vietnam: Manufacturing PMI declines further in January but remains in expansionary territory
February 3, 2020
According to data released by IHS Markit, the manufacturing Purchasing Managers’ Index (PMI) registered 50.6 in January, down from 50.8 in December. However, the index remained above the 50-threshold that signifies improving operating conditions in the manufacturing sector.
January’s dip came on the back of a slower rise in employment, while output declined. However, new orders continued to rise, while new exports returned to growth. On the price front, input cost inflation rose, feeding through to higher output prices.
Commenting on January’s reading was Andrew Harker, associate director at IHS Markit:
" […] firms appear to be taking a step back from raising production at present, preferring to utilise inventories to help meet customer orders. This will likely change soon, however, should the upward trajectory of new business continue. The Vietnamese manufacturing sector looks set to be a star performer again in 2020, helping to support impressive growth in the wider economy”.
Author: Oliver Reynolds, Economist