By ANGELA CELIS
The operating conditions of the Philippines’ manufacturing sector posted a softer expansion in October versus the previous month’s level, according to a report released yesterday.
The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) registered 52.6 in October, down from 52.9 in September.
The report said that overall growth, while slightly softer than the preceding period, stemmed from greater demand, resulting in further expansions in output and new orders.
However, the report pointed out that inflationary pressures remained elevated, as average costs increased at a quicker rate compared to that seen in September.
Additionally, while factory gate charges rose at a marginally softer rate during October, the latest reading ranked amongst the fastest on record since January 2016, it added.
“Demand conditions continued to improve, resulting in a further rise in output and new business placed at good producers. Firms also signaled growth in buying activity and employment. Despite the pace of the latest upturns easing slightly on the month, firms continued to increase capacity and stocks to support future growth,” Maryam Baluch, economist at S&P Global Market Intelligence, said.
“While ongoing growth meant firms remained positive overall, supply-side constraints and rising global inflation continued to weigh on the manufacturing sector. Anecdotal evidence noted shipping delays, bad weather and congestion continued to hamper production. Moreover, currency weakness and global price rises in energy and materials resulted in the rate of input price inflation regaining momentum,” Baluch added.
While an improvement in operating conditions across the manufacturing sector was reported during October, the latest Future Output Index reading took a hit from the recent high in September, the report said.
“Nevertheless, output expectations for the coming 12 months remained optimistic with nearly 60 percent of panelists upbeat regarding the outlook for production. Confidence was underpinned by hopes of continued upticks in demand over the coming year,” the report said.
