The Philippine manufacturing sector continued to expand in February, though at a more moderate pace compared to January, according to S&P Global.
In a report released on Monday, S&P Global said the country’s Manufacturing Purchasing Managers’ Index (PMI) eased to 51.0 in February, down from 52.3 in January.
A PMI above 50 indicates sector growth, while a score below 50 signals contraction.
“Robust growth observed from the end of last year into early 2024 slowed in February, as the latest survey data showed weaker expansions in output and new orders,” said Maryam Baluch, economist at S&P Global Market Intelligence.
Manufacturers boost employment
Despite the moderation in new orders and output, the report highlighted a notable improvement in employment levels, as manufacturers increased hiring for the first time in three months.
Additionally, inflationary pressures eased, raising expectations that the Bangko Sentral ng Pilipinas (BSP) may proceed with a looser monetary policy.
“With inflationary pressures cooling, it suggests that the central bank may continue easing monetary policy, which could, in turn, boost business confidence and support further order growth,” Baluch added.
Optimism for the year ahead
Looking ahead, manufacturers remain optimistic about the sector’s performance over the next 12 months. Firms expect demand to improve further and anticipate that the upcoming elections may provide an additional economic boost.
While growth slowed in February, industry players remain hopeful that favorable economic conditions will support continued expansion in the Philippine manufacturing sector.