The country’s manufacturing and services sectors have expanded better in February than the lag suffered in January according to the performance of the latest Purchasing Managers Index.
The Central Bank said The Manufacturing Sector PMI changed to 51.7 from 55.6 in February from the previous month, indicating that manufacturing activities had increased driven by new orders, the Central Bank said, adding that a similar pick up was also observed in Services.
The Manufacturing Sector PMI recorded 55.6 index points in February from 51.7 index points in January 2018. This indicates that the Manufacturing activities expanded at a higher rate in February compared to January 2018 after the seasonal slowdown observed during the previous month. In January the Manufacturing Sector PMI was 51.7 index points from 59.1 index points in December 2017. The Services Sector PMI was 56.6 index points in January 2018 from 61.2 index
points in December 2017. Central Bank said the upturn in February was mainly driven by the expansion in the New Orders sub-index. The Production sub-index also increased with the increase in new orders.
Nevertheless, this increase was relatively low compared to that of new orders due to lesser number of working days in February. Further, Stock of Purchases sub-index also expanded during the month while Employment sub-index expanded marginally.
Meanwhile, the Suppliers’ Delivery Time sub-index lengthened at a higher rate compared to the previous month. Overall, all the sub-indices of PMI recorded values above the neutral 50.0 threshold signalling an overall expansion in manufacturing activities during the month. Moreover, the Expectation for Activities indicates an improvement for the next three months.
The Services Sector PMI recorded 58.4 index points in February 2018 from 56.6 index points in January 2018. This indicates that the Services sector gathered momentum in February 2018 supported by New Businesses, Business Activity, Employment and Expectations for Activity.
A steeper gain was observed in the business activities of the Financial Services, IT Programming, and Transportation of Goods and Warehousing sectors. Meanwhile, employment increased in February 2018 in contrast to the decline observed in January, and was prominent in the Wholesale and Retail Trade sector. Backlogs of Work declined in February 2018, reversing the trend observed during the past two months, partly caused by increase in employment due to new recruitments. Service providers’ optimism on the three-month business outlook also strengthened at a modest pace.
Expected Labour Cost increased compared to the previous month due to expected salary increments in 2018, while Prices Charged of the Services sector increased, albeit at a slower rate.