The Philippine manufacturing sector continued to grow in February, though at a slower pace, with the Manufacturing Purchasing Managers’ Index (PMI) dipping to 51 from 52.3 in January, S&P Global’s latest report said.
A PMI reading above 50 signals expansion, while a score below that threshold indicates contraction.
While the sector’s growth momentum slowed in February, S&P Global Market Intelligence economist Maryam Baluch highlighted that output and new orders experienced more modest expansions. “Robust growth observed from the end of the previous year into the beginning of this year waned in February, as the latest survey data indicated slower expansions in output and new orders,” she noted.
Despite the softer growth, the report pointed out a positive shift in the labor market, with manufacturers increasing employment for the first time in three months. In addition, easing inflationary pressures were observed, which could pave the way for continued monetary policy easing by the central bank. “This could in turn boost somewhat weakened business confidence and support further new order growth,” according to Baluch.
Looking ahead, the report said that manufacturers remain optimistic about future production, with many expecting demand to improve. There is also hope that the upcoming elections will provide a boost to business conditions over the next 12 months.