This marks the twelfth consecutive month of improvement, albeit at a modest pace, in the overall health of the sector.
Key findings from the report indicate that while output and new orders recorded stronger upticks, employment in the sector slipped back into contraction, reversing the slight gains seen in July.
The sustained PMI of 51.2 reflects a balance between continued domestic demand and challenges in international sales.
Local sales up, exports down
New orders saw their strongest growth in three months, driven largely by domestic demand, as export sales fell for the first time since the beginning of the year, according to the S&P Global report.
This domestic-driven demand led to an increase in production levels, with the growth rate nearly matching the long-term average. However, firms remained cautious in their hiring, resulting in a contraction in employment for the third time in the past four months.
Despite the positive trends in orders and production, the pace of purchasing activity softened to a five-month low, leading to a slight and weakening accumulation of pre-production inventories.
Expectations
Meanwhile, post-production inventories declined for the first time since February, reflecting the sector's focus on efficiency amid cautious optimism.
Inflationary pressures eased further in August, with input costs rising moderately and selling prices increasing at a slower pace. This suggests that manufacturers are absorbing some costs to stay competitive.
Looking ahead, Filipino manufacturers are optimistic about continued expansion in output over the next 12 months, with the respective index printing well above the neutral 50.0 mark. However, latest data showed a slight dip in the level of confidence, indicating expectations for more modest growth in the near term.
