Manufacturing sector’s 2-year expansion interrupted
MANILA -The manufacturing sector in the Philippines ended in August a two-year expansion run, but many firms are gearing up for the yearly fourth-quarter sales boom, according to S&P Global.
The company’s Philippines PMI or purchasing managers index read at 49.7 in August, which signaled a contraction.
A PMI—which is based on a monthly survey of managers —of above 50 means an overall increase (more positive responses than negative) while less than 50 means an overall decrease (more negative answers than positive).
Still, S&P Global described the slide as “fractional overall,” considering that it followed a reading of 51.9 for July.
In turn, the July print represented an improvement from June’s 50.9, which was an 11-month low.
According to S&P Global, results from the latest poll for the Philippines showed that the domestic manufacturing sector “signaled a deterioration” in business conditions in August when new orders fell for the first time in a year while output growth cooled.
Also, the sector’s workforce was trimmed yet again, for the third month in a row, compounded by resignations and nonrenewal of employment contracts.
S&P Global said that while the rate of job shedding was moderate overall, it was the strongest in 23 months.
S&P Global Market Intelligence economist Maryam Baluch said that while the headline PMI figure signaled an end of the growth period seen over the past two years, at the same time many companies were also gearing up for greater sales in the coming months, with buying activity and stocks raised in August.
