MANILA – Manufacturing conditions in the Philippines have rebounded towards the end of the second quarter, the IHS Markit Philippines Manufacturing Purchasing Managers’ Index (PMI) reported Thursday.
The manufacturing index for June settled at 50.8 from 49.9 in May.
Scores above 50 indicate improvement of the sector and lower than 50 reflect deterioration.
“June data highlighted a partial rebound in the Filipino manufacturing sector following two consecutive months of contraction seen at the start of the second quarter,” IHS Markit economist Shreeya Patel said.
Patel added that declines in output, new orders, and employment eased in June while exports rose sharply.
The IHS Markit reported that demand for Philippine-produced goods grew for two straight months, with a growth rate last month stronger than the historical average.
However, while community quarantine measures eased in the NCR Plus, the modified enhanced community quarantine declared in other areas in the country led to weak domestic demand, the report added.
“It was not all good news in June, however, with MECQ (modified enhanced community quarantine) measures persisting and, in some instances, delaying the supply of inputs. Meanwhile, rising raw material and transportation costs were often faced by goods producers during the month. Output prices rose further, and at the quickest rate in over two years, suggesting firms are committed to somewhat cushioning any potential losses,” Patel said.
Higher costs of transportation and raw materials led to increasing input prices last month, IHS Markit added.
Meanwhile, the business outlook of manufacturers remained rosy as they expect higher production levels over the next 12 months.
Sentiment reached a three-month high, with optimism also supported by the government’s vaccination program, Patel added. (PNA)
