PH manufacturing sector shows growth in July

The S&P Global Manufacturing Purchasing Managers’ Index (PMI) revealed on Thursday that the Philippine manufacturing sector experienced growth in July 2024.

The PMI for July registered at 51.2, a slight dip from June's score of 51.3. Despite the minor decline, a PMI above 50 indicates an overall expansion in the sector, while a score below 50 signifies contraction.

The positive performance in the local manufacturing sector was attributed to increased demand, a rise in hiring activities, and a stable inflationary environment. "The manufacturing sector began the second half of the year with steady growth, reflecting further increases in output and new orders," noted Maryam Baluch, economist at S&P Global Market Intelligence.

S&P Global highlighted that the growth in new orders surpassed the five-month low recorded in June, signaling a robust demand trend within the sector. However, demand from international markets showed signs of moderation during the same period.

Baluch observed that while the rates of growth were weaker compared to long-term averages, the sector still demonstrated resilient performance. "The relatively subdued growth across the sector is reflective of the current demand trends," she added.

In addition to the rise in production, there was also an improvement in purchasing activities within factories. Employment figures in the manufacturing sector have been on an upward trend since April.

The ongoing stability in inflation, as indicated by PMI price gauges, suggests potential opportunities for policy rate cuts. Baluch indicated that easing financial conditions could bolster and enhance growth in the upcoming months.

Despite current challenges, manufacturing companies remain positive about the sector's prospects for the next year.