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The Philippine manufacturing sector returns to growth in June as production rebounded while new business rose at a stronger pace
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The Philippines Manufacturing Purchasing Managers’ Index rose to 50.7 in June from 50.1 in May, indicating a stronger, albeit still modest improvement in the health of the Philippines manufacturing sector
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The upswing in new orders was sufficiently robust to push production levels back into expansion territory, albeit only fractionally
The Philippine manufacturing sector returned to growth in June 2025 as production rebounded while new business rose at a stronger pace.
After a setback in May 2025, the headline Philippines Manufacturing Purchasing Managers’ Index (PMI)—a composite single-figure indicator of manufacturing performance—rose to 50.7 in June from 50.1 in May, indicating a stronger, albeit still modest improvement in the health of the Philippine manufacturing sector, according to the latest survey of S&P Global.
“The overall performance of the Filipino manufacturing sector remained relatively subdued as the first half of the year concluded. That said, the overall PMI figure masked some pockets of strength, such as the revival in employment, which was the first in four months. Output was also raised, thereby reversing the fall in May,” explained S&P Global Market Intelligence economist Maryam Baluch in a statement.
New orders received in the Filipino manufacturing sector rose further in June, with the pace of growth slightly stronger than that recorded in May, although it remained below the long-run survey average.
S&P said anecdotal evidence attributed this latest uptick to successful customer acquisitions, improving underlying demand trends, and effective promotional efforts. The upswing in new orders was sufficiently robust to push production levels back into expansion territory, albeit only fractionally, S&P noted.
In response to the uptick in demand, firms elevated their purchasing activity.
Nevertheless, longer delivery times and material shortages led firms to reduce their inventories of purchases, as companies sought to meet demand requirements. Delivery times for inputs were extended for a 14th straight month, albeit the latest incidence of delay was slight and the least pronounced since May 2024.
Delayed delivery times for inputs and material shortages also meant that goods-producing firms in the Philippines were unable to replenish their post-production inventories effectively, reflecting the challenges faced by manufacturers in effectively expanding production amid growing demand.
The rate of depletion was modest overall. June data also marked a revival in manufacturing employment, which rose for the first time in four months.
Turning to prices, inflationary pressures remained historically subdued. Rates of both input price and output charge inflation were slightly slower than what was seen in May. Where input prices were raised, this was primarily linked by survey panelists to higher material costs.
Forward-looking projections for output strengthened in June compared to May. Factors contributing to increased confidence included a rise in customer numbers, the realization of ongoing projects, stable local market demand, and effective promotional campaigns. That said, the degree of confidence was significantly below historical levels.
