Manufacturing growth slows down in January: PMI survey

Monday, 2015-02-02 17:00:14
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NDO – Vietnam’s manufacturing activity continued to expand in January but at a slower pace than the previous month, according to a survey by HSBC.

The HSBC Purchasing Managers’ Index (PMI) in January was 51.5, down from 52.7 posted in the previous month, but a reading above 50 indicates growth in the manufacturing sector.

According to the survey, the increase in hirings in January was the sharpest since December of 2013 and one of the fastest since data on Vietnam’s manufacturing sector has been collected.

Meanwhile input costs fell at the fastest pace in the survey’s history as a result of falling fuel prices, which in turn led manufacturing firms to cut their output prices sharply.

Both output and new orders continued to rise at the start of 2015, albeit at weaker rates than seen in December, thanks to increased demand, the survey says.

January also saw a modest improvement in vendor performance with surveyed firms suggesting that faster payments and requests for quicker deliveries had resulted in shorter lead times.

Commenting on Vietnam’s PMI in January, economist Trinh Nguyen at HSBC said despite slowing new export orders, employment rose sharply, highlighting strong demand for Vietnamese goods.

She expected output to continue to expand in February although there will be some seasonal slowdown due to the Lunar New Year festival.