Philippines factory growth slows as costs jump in March

PMI falls to 51.3.

Philippine manufacturing growth slowed in March as higher energy costs and weaker demand weighed on output and new orders, according to S&P Global.

The Philippines Manufacturing Purchasing Managers’ Index fell to a three-month low of 51.3 in March from 54.6 in February, although the reading remained above the 50 mark that separates growth from contraction.

S&P Global said customer uncertainty linked to the war in the Middle East contributed to softer increases in production and total new orders, whilst new export sales returned to decline after expanding in the previous month.

Purchasing activity stalled in March, ending a three-month sequence of growth, as firms adjusted buying activity amid slower demand and pressure on inventories.

Supplier delivery times also lengthened for a fourth straight month as higher gas and fuel prices and material shortages disrupted supply chains.

Input costs and factory gate charges rose again in March after falling slightly in February, with S&P Global describing inflationary pressures as historically strong.

Employment increased for a third straight month, but the pace of job creation was marginal and the weakest in the current sequence.

Manufacturers remained optimistic about the year ahead, with confidence rising to a four-month high on hopes that demand conditions will improve and support production growth.