MANILA, Philippines — Philippine manufacturing activity bounced back in April after a contraction in the previous month, supported by a pick-up in demand.
In a statement, S&P Global said the Philippines’ manufacturing purchasing managers’ index (PMI) stood at 53 in April, up from the March reading of 49.4.
Last month’s PMI result showed renewed improvement in the health of the country’s manufacturing sector. A reading above 50 indicates growth, while below 50 denotes a contraction.
The PMI, which is based on a survey of around 400 manufacturers, is the weighted average of the following: new orders, output, employment, suppliers’ delivery times and stocks of purchases.
“The Filipino manufacturing sector commenced the second quarter of the year on a solid note, experiencing renewed growth in output and new orders, alongside an increased level of purchasing activity,” S&P Global Market Intelligence economist Maryam Baluch said.
S&P Global attributed the strong growth rates posted in new orders and output to new client acquisitions and the upcoming election.
Higher output needs prompted manufacturers to increase their buying activity in April.
In terms of prices, Baluch said inflationary pressures were subdued in April.
Employment in manufacturing, however, was unchanged for the second straight month in April.
Despite improvement in manufacturing activity, Baluch said companies are taking a cautious approach in expanding workforce numbers.
While firms are hopeful that output will rise over the next 12 months, the level of confidence fell to the second lowest on record.
“Some respondents indicated that the rise in activity during April was partially influenced by the upcoming elections, suggesting that post-election, customer demand may be less buoyant,” Baluch said.