Vietnam PMI hits 50 mark for first time in six months
VOV.VN - A recently released survey by S&P Global indicates that the Vietnam Manufacturing Purchasing Managers' Index (PMI) rose to 50.5 in August from the previous figure of 48.7 in July, thereby showing some signs of an economic recovery.
This represented the first increase in factory activity since February, amid output, new orders, and foreign sales all returning to growth, according to S&P Global.
Furthermore, purchasing activity rose for the first time in six months and was the most pronounced since September, 2022.
Meantime, employment fell for the sixth consecutive month, although the pace of decline was the weakest in the sequence; while backlogs of work decreased for the eighth consecutive month.
Moreover, S&P Global showed that delivery times were shortened for the eighth month amid suppliers’ stocks remaining sufficient to deal with orders despite a pick-up in demand for inputs.
The survey reported that on the cost front, input prices rose solidly, duly ending a three-month period of decline amid rising prices of both oil and food; while the increase in charges was the first since March. Lastly, sentiment improved to a five-month high, but remained below the series average amid ongoing concerns regarding the strength of demand.
The S&P Global Vietnam Manufacturing Purchasing Managers’ Index measures the performance of the manufacturing sector and is derived using a survey conducted by 400 manufacturing companies.
The index is based on five individual indexes, including new orders making up 30%, output making up 25%, employment making up 20%, suppliers’ delivery times making up 15%, and stock of items purchased making up 10%, with the delivery times index inverted so that it moves in a comparable direction.
A reading of above 50 therefore indicates an expansion of the manufacturing sector compared to the previous month, below 50 represents a contraction, while 50 indicates no change.
