Business anticipates higher demand in the fourth quarter with Christmas and the resumption of 100-percent face-to-face classes.
While this will fuel manufacturing activities to transition to near pre-pandemic levels, business leaders said a slight correction is expected by January as higher prices temper consumption.
According to Joey Concepcion, Go Negosyo founder, manufacturing companies are stocking up on commodities to make sure there is enough to supply essentials such as sugar and flour throughout the Christmas season and through to the first quarter of 2023.
Concepcion explained the fourth quarter economic activity will be crucial for business as it represents the peak of consumer spending.
“Hopefully, sales for the micro small and medium enterprises will be good and they will have enough working capital to let them cross over to 2023,” he said in a statement yesterday.
George Barcelon, president of the Philippine Chamber of Commerce and Industry, said manufacturers anticipate the “ber” months as a traditionally peak demand with holiday spending fueled by the mandatory 13th month pay and Christmas bonus.
But Barcelon said as the value of the peso has declined to date by 16 percent, input costs of manufacturers have also risen.
He said manufacturers are not passing on the increase to consumers to encourage them to spend.
“After the holidays, consumers will have a reality check and will slow down on their spending especially as fuel prices continue to increase,” he said.
The return to 100-percent face-to-face classes by November, he said, will also affect consumers’ purchasing power as households will prioritize the needs of school-age members of the family.
The S&P Global Philippines Manufacturing PMI (purchasing managers index) reached 52.9 in September, the highest in three months, and buoyed by customer demand.
