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The Philippines Manufacturing Purchasing Managers’ Index jumped to a 29-month high in November to 53.8 from October’s 52.9
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The manufacturing sector ramped up production in anticipation of greater sales in the coming months
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Supply chains remained strained, however, due to adverse weather conditions that led to port congestion and severely impacting delivery times for inputs
The Philippines Manufacturing Purchasing Managers’ Index (PMI) jumped to a 29-month high of 53.8 in November from 52.9 in October, according to S&P Global.
This marks the 15th consecutive monthly improvement in the health of the Philippine manufacturing sector, and one which was the most marked since mid-2022, S&P Global said.
“November saw the Filipino manufacturing sector ramping up production in anticipation of greater sales in the coming months. Hiring, purchasing activity and postproduction inventories were also raised in preparation. New sales recorded further growth, as demand conditions continued to improve,” said S&P Global Market Intelligence economist Maryam Baluch.
Demand conditions improved for the 15th straight month and while the pace of increase moderated to a three-month low, it remained solid and historically strong, S&P noted.
The uptick in output was also attributed by companies to inventory building. Stocks of finished goods rose for the first time in four months, with the rate of accumulation the joint-fastest in two years (alongside April 2024).
Companies expanded their capacity further as job creation was recorded for a third straight month. The pace of increase was just shy of October’s recent peak.
Purchasing activity surged as well, with the rate of expansion accelerating over the month. However, this increase in input buying did not translate into a rise in pre-production inventories, as companies often utilized inputs directly for production.
November data, meanwhile, signaled that supply chains remained strained. Adverse weather conditions stemming from recent typhoons and their impact, led to port congestion and flooding and severely impacted delivery times for inputs, with average lead times lengthening rapidly and to the most significant degree in over three years.
Meanwhile, inflationary pressures intensified. Rising costs from suppliers and raw materials resulted in a rapid increase in expenses, which was the strongest since February 2023. Consequently, charges for Filipino manufactured goods rose sharply, with output charge inflation also hitting a 21-month high.
Despite these challenges, S&P said manufacturers expressed strong optimism regarding future output in November. Sentiment reached its highest level since early-2023, as firms were hopeful that improving demand conditions and the upcoming election year would support further expansions.
