Vietnam’s manufacturing still strong in July
The Nikkei Vietnam Manufacturing Purchasing Managers’ Index (PMI), fell to 54.9* index points in July 2018, compared to June’s result of 55.7. However, this reading is still one of the highest since the survey began in 2011. In comparison, the Vietnam PMI reading in January 2018 was 53.4, and 52.7 in April 2018.
According to the survey, the main finding shows a rebound in the pace of growth in new export orders to a near-record high. July’s rate of growth was only fractionally weaker than June’s 87-month high. In response to new orders, manufacturers increased their staffing and purchasing activity levels.
[Surging recruitment demand in Vietnam’s manufacturing sector]
Andrew Harker, Associate Director at IHS Markit said: “The Vietnam manufacturing PMI remained elevated in July as the sector continued to grow strongly. Confidence in the future was illustrated by efforts by firms to build inventory reserves in order to prepare for further production growth and further solid hiring” .
The report suggests that the stocks of both purchases and finished goods increased. The rate of accumulation of pre-production inventories accelerated to a five-month high, while stocks of finished goods increased modestly in July following a fall in June.
Vietnam has been the leading ASEAN country when it comes to PMI reading at the end of 2017 and beginning of 2018.
* - a reading above 50 signals an improvement, while one below 50 points to a contraction in manufacturing activity.
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