Vietnam PMI March 2016

Vietnam

Vietnam: Manufacturing PMI rises in March

April 1, 2016

The Nikkei manufacturing Purchasing Managers’ Index (PMI) rose from 50.3 in February to 50.7 in March. The indicator remains above the 50-threshold that separates expansion from contraction in business conditions. With the exception of two months in late 2015, the Vietnamese Manufacturing PMI has been in positive territory since September 2013.

The monthly figure mainly reflects expansions in new orders and output. The rise in new orders came on the back of stronger customer demand, especially from foreign markets. Higher new orders contributed to an increase in manufacturing output. Employment, on the other hand, dropped marginally in March after increasing for three consecutive months. Regarding price developments, input costs increased for the first time since June while output costs dropped at the slowest rate in 18 months.

Nikkei stated that, “the Vietnamese manufacturing sector posted a solid but unspectacular performance in March, as has been the case throughout the first quarter of the year. […] Meanwhile, the recent run of falling input costs came to an end, but firms are still able to benefit from a relatively weak inflationary environment to maintain their competitive position.”

FocusEconomics Consensus Forecast panelists see investment rising 9.1% in 2016, which is down 0.5 percentage points from last month’s forecast. For 2017, the panel expects investment to grow 8.8%.


Author: Jean-Philippe Pourcelot, Economist

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Vietnam PMI Chart


Vietnam PMI March 2016

Note: Nikkei Purchasing Managers’ Index. Readings above 50 indicate an expansion in the manufacturing sector while readings below 50 point to a contraction.
Source: Nikkei and Markit


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