Manufacturing activity in Emerging Asia seen weakening in April

MANILA, Philippines — Manufacturing activity in Emerging Asia – as measured by the Purchasing Managers’ Index (PMI) – is seen to have weakened in April from March results, mirroring the sectoral weakness in advanced economies, said London-based Capital Economics over the weekend.

The April manufacturing PMIs which are scheduled for release next week is expected to reflect slower growth in manufacturing activity in line with preliminary manufacturing PMIs for US, eurozone and the Flash PMI in Japan.

“With the exception of the Philippines and Malaysia, PMIs across Emerging Asia rose last month (March). We expect PMIs to fall back slightly from the March reading,” according to a report by Capital Economics.

The average PMI readings for advanced economies fell in April, suggesting that GDP growth in US, eurozone, and Japan may have dropped at the start of the second quarter.

“Looking ahead, weak export growth is likely to remain a headwind to the region’s manufacturing sectors,” the firm said.

It noted, however, that there are indications that the slowdown may be over soon and the manufacturing industries in Emerging Asia may begin to recover in the coming months.

“There are signs that the worst may now be over for the region’s exporters. As a result, while the PMIS are likely to remain weak, they may start to recover a little bit of ground over the coming months,” Capital Economics said.

While reflecting a slowdown in manufacturing activity, the PMI for the Philippines stayed above the 50 mark in March, indicating expansion.