The Philippines’ manufacturing sector improved in February despite the risk brought by the new corona virus diseases 2019, as new orders from both local and overseas clients sustained growth, IHS Markit said.
The IHS Markit Philippines Manufacturing Purchasing Managers’ Index edged up in February to 52.3, from 52.1 in January.
The index is compiled by IHS Markit from responses to monthly questionnaires sent to
purchasing managers in a panel of around 400 manufacturers. IHS Markit is a world leader in critical information, analytics and solutions for the major industries and markets worldwide.
“By increasing further above the neutral 50 mark, this was indicative of a faster rate of improvement in manufacturing sector operating conditions,” the report said.
“That said, although the headline index reached its highest mark in just over one year it remained below its historical average,” it added.
Joe Hayes, economist at IHS Markit, said the February survey data signaled a continuation of respectful growth across the Philippines’ manufacturing sector.
“Firms are enjoying resilient demand conditions, both domestically and abroad, with anecdotal evidence suggesting that pipeline work remains sufficient to support the positive production trend in the near term,” Hayes said.
The report said new orders rose at the fastest rate since last October during the latest survey period.
However, it said shipment delays from China due to the COVID-19 outbreak hindered stockpiling of finished goods and inputs, and also led to a slower decline in outstanding work.
“COVID-19 poses a downside risk, but this seems to have been isolated to the supply-side so far as exports grew at the fastest rate in over one-and-a-half years,” Hayes said.
“That said, panellists indicated that input deliveries out of mainland China had dented stockpiling and slowed the rate at which firms were completing outstanding orders,” he added.
Hayes said given that stocks of purchases have risen strongly in recent months, firms should have appropriate buffers in place to withstand delivery disruptions.
“But if they continue, production volumes could be adversely impacted,” he added.
