Philippines’ manufacturing PMI dips in January

Demand continued to improve yet the pace of expansion was slow.

The Philippines’ manufacturing output continued to grow but at a slower pace in January, according to S&P Global.

The country's purchasing managers’ index (PMI) stayed over the neutral 50.0 mark at 52.3 in January, lower than December's 32-month high of 54.3.

During the month, demand for Filipino goods continued to improve yet the pace of expansion in new business experienced a slight slowdown from the recent high recorded in December.

Nevertheless, the expansion rate in intakes of new orders remained robust as firms reported that strong client demand and the acquisition of new customers drove increased sales.

However, the growth rate was the second-weakest in the current ten-month increase, as competition and rising raw material prices reportedly limited production activity.

Despite these, expectations of increased sales prompted firms to boost their purchasing activity in January with companies also focusing on stock building. Both pre and post-production inventories rose at historically strong rates.

Moreover, supply chains remained under pressure. Shortages of delivery trucks and port congestions were cited as reasons for extended average lead times for inputs.

Regarding prices, both cost burdens and output charges increased at similar, but historically subdued, rates that manufacturers opted to pass on to their clients.