November data pointed to sustained growth in the Vietnamese manufacturing sector. Output, new orders and employment all continued to rise, despite disruption caused by severe storms that affected supply chains and delayed production.

Supply issues as a result of the storms also contributed to inflationary pressures, with input costs rising sharply and firms increasing their selling prices accordingly. A third successive monthly increase in new orders helped drive production growth in November, although the pace of expansion in output and new business eased slightly from October. New export orders, meanwhile, grew at the fastest rate in 15 months.

Panellists highlighted improving demand from mainland China and India. Some firms noted that stormy weather in November limited production growth, but output nonetheless increased for the seventh consecutive month. Delivery times lengthened markedly, to the largest extent since May 2022, and backlogs of work rose for the second month in a row, at the sharpest rate since March 2022.

Firms increased employment for the second consecutive month in response to higher output requirements. Staffing levels rose modestly but at the fastest pace in nearly 18 months. According to respondents, new staff were often hired full-time. In some cases, existing inventories were used to meet orders, reducing stocks of finished goods more than in the previous survey period.

The storms also contributed to higher raw material costs as supply tightened. Input prices rose sharply, recording the second-fastest pace since July 2024, while output price inflation eased slightly but remained solid as firms passed on higher input costs to customers.

Purchasing activity expanded for the fifth month in a row in November, with the rate of growth reaching a four-month high. Stocks of inputs increased for the second consecutive month, though the rise was modest as inventories were often used to support production.

Optimism for the year ahead remained high, supported by expected improvements in new orders and hopes for calmer weather. Nearly half of respondents anticipated higher production, with overall sentiment hitting a 17-month high.

Andrew Harker, Economics Director at S&P Global Market Intelligence, said: “The pick-up in growth seen in October was largely sustained through to November as the Vietnamese manufacturing sector looks to be enjoying a positive end to the year. While rates of expansion in output and new orders eased, firms took on extra staff at a stronger pace in order to deal with workloads.”

“Growth was recorded despite reports of disruption to supply chains and production lines caused by stormy weather in recent weeks. There is the potential, therefore, for continued growth in the months ahead as firms catch up with delayed projects,” he said.

PMI holds at 50.4 in August despite tariff-driven drop in orders

VOV.VN - Despite the impact of tariffs causing a drop in new orders, the Vietnam Manufacturing Purchasing Managers' Index (PMI) posted 50.4 in August, signaling a second consecutive monthly improvement in the health of the manufacturing sector.