S&P Global said on Monday that Filipino production activity lasted in January, although on the slowest pace for five months.
The S&P Philippines (PMI) production managers index was 52.3 in January, soothing with 54.3 logged in in December 2024. It was the bottom PMI reading for five months or from reading 51.2 in August 2024.
In his report, S&P Global said that reading PMI signaled “solid improvement” in production conditions in the Philippines.
PMI reading above 50 means higher working conditions than in the previous month, while the reading below 50 shows deterioration.
“The Filipino production sector began a year with further and strong improvement in demand. Production has increased again, although at a pace that weakened significantly since December, “said Maryam Baluch, economist S&P Global Market Intelligence on Monday.
In January, the Philippines had the fastest PMI reading among the many six Association of Member States of the Nations of Southeast Asia (ASEAN) before Indonesia at 52.3.
Cramp in production activity was observed in Thailand (49.6), Vietnam (48.9), Malaysia (48.7) and Myanmar (47.4).
The demand for goods produced by Filipino improved in January, although the growth rate has barely developed in recent high observed in December, said S&P Global.
“Nevertheless, the expansion rate in consuming new orders remained historically solid, because companies reported that strong demand for customer and acquiring new customers increased sales,” he said.
S&P noticed that trends in solid demand increased production production, but January meant the second weakest in the current 10 months of growth.
This was assigned to the competition and raised prices of raw materials that limited production.
However, the rise in production requirements prompted producers to operate on shopping in January.
“Companies also focused on building stocks, with pre -production stocks increased according to historically strong rates in the latest survey,” said S&P.
“In particular, the stocks of ready goods recorded a new increase after a sharp decline in December.”
In January, the provision chains remained under pressure. The lack of delivery trucks and the overload of the port was prolonged by the typical time of input data implementation, said S&P.
The decrease in the supplier’s results in January was the least clear inside five months.
S&P Global said that employment remained flat for the second month in a row.
Increased sales encouraged production firms to employ more employees, but were compensated by reports about resignation.
“As for prices, both cost loads and production fees increased at similar but historically subdued rates,” said S&P, adding that the high costs of materials and transport increased the expenses that firms transfer to their clients.
In the approaching 12 months, producers maintained positive perspectives, driven by expectations with a stronger market demand and the upcoming election period. However, general sentiment remained below the extent of the trend.
“If demand trends improve, as they have done, an increase in employment can be on the cards in the coming months,” Baluch said.
Mrs. Baluch said that the election 12 months would probably help to extend the growth of the production sector, citing survey respondents.
“We have seen that 2025 is shaped to be another strong year of growth in the Philippines production sector with an increase in industrial production forecast at 3.9% in 2025, compared to 2.4% in 2024.” she said.
“In fact, predicting greater demand has already prompted producers of goods to increase the level of inventory.”
The Philippines will conduct intracerexiacs on May 12.
Chief economist Rizal Commercial Banking Corp. Michael L. Ricafort said that the slower pace of factory activity was partly brought on by a “seasonal decline in demand and production activities after crossing the new year after the holiday season.”
“Still relatively higher prices, interest rates and a weaker peso replacement exchange rate vs. American dollar from 2022 also partially burdened on demand and production activity, “added Ricafort.
He also said that increased government expenditure on infrastructure and a few election expenses can profit some manufacturers who’re a part of the provision chains of varied infrastructure projects.
In the Miguel Chanco e-mail, the top of Macroeconomics Pantheon Emerging Asia, said that the Philippines remain the important resignation from the region, but “hit a high increase in speed.”
“In general, the region’s index in January was the youngest print in 11 months; At best, his general slowdown still stabilizes. “
ASEAN PMI was 50.4 in January, soothing from 50.7 in December.
Mr. Chanco said that the header reading would probably fall, and never improve, “because short -term leading indicators continue to weaken.” – – Aubrey Rose A. Inosante