The Vietnamese manufacturing sector saw improved growth at the end of the third quarter that was reflected by the Nikkei Manufacturing Purchasing managers’ Index (PMI) rise to 52.9 in September from 52.2 in the previous month, the most marked since May 2015.
The rate of growth in manufacturing output solidly picked up to a three-month high in September. Higher production reflected a further rise in new orders, according to a report released by Nikkei on October 3.
Andrew Harker at IHS Markit, which compiles the survey, said the standout number from the latest Vietnam PMI survey was the fastest rise in employment for five and-a-half years as firms responded to sustained new order growth.
Higher inventory levels were also reported, and a number of respondents ascribed this to efforts to build reserves. This all suggests a level of confidence among manufacturers that output will continue to rise in the near term at least.
“With growth solid across the third quarter as a whole, the manufacturing sector looks set to help drive gross domestic product (GDP) growth in 2016. IHS Markit currently forecasts a rise in GDP of 5.9 percent in 2016,” Harker said in the report.
New business increased for the tenth successive month, with the rate of expansion quicker than that seen in August. Meanwhile, new export orders also rose. Growth of new work encouraged firms to take on extra staff in September.
The rate of input cost inflation ticked up fractionally in September and was broadly in line with the series average. Panelists mentioned higher prices in global markets and shortages of the supply of raw materials.
Output prices went up for
the first time in four months as manufacturers attempted to pass higher input costs on to clients. However, the rate of inflation was only slight.
Besides, supply shortages were also mentioned by respondents that saw a lengthening of suppliers’ delivery times in September. This was outweighed by competition among vendors, resulting in a first improvement in supplier performance since April.
Vietnamese manufacturers’ purchasing activity increased at a sharp pace that was the fastest since May 2015. Firms credited the rise to higher new orders and efforts to build inventory reserves.
Stocks of both purchases and finished goods rose in September. Pre-production inventories posted a further solid increase following the previous month’s joint-survey record, while stocks of finished goods were accumulated for the first time in ten months.
Source: http://english.thesaigontimes.vn
Key words : Vietnam, PMI, hits, 16-month, high.
