Vietnam: Manufacturing PMI drops to 14-month low in May
June 1, 2017
The Nikkei manufacturing Purchasing Managers’ Index (PMI) dropped to a 14-month low as growth in the Vietnamese manufacturing sector eased. May’s reading came in at 51.6, well below April’s 54.1, but still above the crucial 50-point mark that separates expansion from contraction in the manufacturing sector.
May’s drop in the PMI was driven by much weaker growth in output, new orders and employment. Further, input cost inflation eased, while slower growth in demand lead to reduced output prices. Following the developments in the manufacturing sector this month, Andrew Harker, economist at IHS Markit, commented that, “while all these variables remained in expansion territory, confidence dipped to the lowest in almost four years. This suggests some concern among manufacturers that a soft-patch may be around the corner.”
Author: Jan Lammersen, Economist