MANILA – The country’s manufacturing purchasing managers’ index (PMI) rate in May registered a “softer decline”, IHS Markit’s survey shows.
Manufacturing PMI last month was at 40.1 from April’s index of 31.6.
PMI readings below 50 means deterioration of the sector.
“The Philippines PMI signaled a softer decline in operating conditions across the manufacturing sector in May. The headline index picked up and was much higher than April when the lockdown had its great impact on production,” IHS Markit economist David Owen said.
The easing of lockdown measures in rural areas has also helped in slowing down the decline, Owen added.
The report shows production levels in May remain subdued as the physical distancing protocol led to a lower capacity of factories.
The survey added that demand for manufactured goods from domestic and international markets continued to decrease last month.
New order volumes likewise remain weak, discouraging firms to raise their output.
“Employment continued to drop amid excess capacity, further hampering demand conditions,” Owen said.
He said price pressures started to increase last month compared to declining prices in March and April, but the higher prices of raw material were marginal due to lower oil prices.
“Looking forward, the degree of sentiment regarding output in a year's time continued to improve from March's nadir, as companies were encouraged by a partial easing of lockdown measures and Covid-19 (coronavirus disease 2019) cases being kept under control. Firms hoped that the introduction of new products would also drive activity higher,” the IHS Markit report added. (PNA)
