The Philippines manufacturing sector expanded in April albeit it at a slower rate than the previous month as output, new orders and employment saw a slower rate of growth.
The Nikkei-Markit Philippines manufacturing purchasing managers’ index edged down slightly to 53.3 in April from 53.8 in March remaining above the 50-point line separating expansion from contraction.
Order growth slowed compared to the previous month but the pace of expansion remained “robust” on strong client demand as , the survey found. Increased construction activities and solid economic growth supported a rise in new business volumes.
This was as export sales increased at the slowest rate in 14 months, pointing to the domestic market being the main driver of manufacturing growth, the survey found.
Factories in the Philippines took on more staff during the month but at a slower pace compared to the previous month.
Cost inflation remained elevated in April leading to a marked rise in factory gate prices as companies looked to maintain margins.
Bernard Aw of IHS Markit said:
“Nikkei Philippines PMI data suggests the solid manufacturing upturn seen in the first quarter was sustained into the second quarter, underpinned by domestic demand. There were further signs that growth momentum will be sustained for the rest of the quarter, as forward-looking indicators such as new orders and expectations continued to show robust trends. The domestic market continued to be the key driver of manufacturing growth, with foreign demand for Filipino manufactures rising only modestly despite depreciation of the peso. However, the weaker local currency led to costlier imported inputs.