Vietnam's manufacturing PMI rises to highest in 33 months: HSBC
0 Comment(s)
Print
E-mail Xinhua, February 6, 2014
Growth in the Vietnam's manufacturing sector gathered momentum at the start of 2014, highlighted by the strongest rise in output and the fastest rise in purchasing activity since April 2011, said a survey report made public here on Thursday.
The report issued by the Hong Kong and Shanghai Banking Corporation (HSBC) said the adjusted Purchasing Managers' Index ( PMI), a composite indicator designed to provide a single-figure snapshot of operating conditions in the manufacturing economy, rose for the second month running in January, posting 52.1 from 51. 8 in December.
The reading pointed to a fifth consecutive monthly improvement in business conditions in the sector and the second-strongest since the survey was conducted in April 2011.
The rate of growth in production was also the second-fastest in history. Output rose for the fourth month running, with rising new orders and the completion of outstanding business mentioned by respondents, said the report.
New orders increased for the fourth time in the past five months and at a solid pace that was little changed from that seen in December. Panelists reported strengthening client demand. New export orders also rose in January, ending a two-month sequence of decline. Meanwhile, backlogs of work decreased at a solid pace for the third consecutive month.
January data signaled a record rise in purchasing activity in the Vietnamese manufacturing sector, with input buying increasing at a marked pace over the month. Anecdotal evidence suggested that increases in new orders and production requirements had underpinned rises in input buying. Despite sharp growth of purchasing activity, pre-production inventories decreased as inputs were used to support rises in output.
Increased demand for inputs imparted capacity pressure on suppliers, leading to a lengthening of delivery times for the first time in four months. The deterioration in vendor performance was only slight.
Commenting on the Vietnam Manufacturing PMI survey, Trinh Nguyen, Asia economist at HSBC said: "The notable bounce of the manufacturing sector reflects strengthening demand, both domestic and abroad. The continued increase of employment shows that manufacturers are upbeat about the sector's growth outlook."
"We expect exports to boast another strong year in Vietnam, lifting growth to 5.6 percent. With input price inflation stable, the State Bank of Vietnam has space to keep rates on hold," said Nguyen.
The HSBC Vietnam Manufacturing PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in around 400 manufacturing companies on five of the individual indices of new orders, output, employment, suppliers' delivery times, and stock of items purchased. Endi
Go to Forum >>0 Comment(s)