Manufacturing sector shows record growth in December

Manufacturing sector shows record growth in December

The Caixin/Markit manufacturing Purchasing Managers' Index came in at 50.8 for last month - the lowest level in five months, Caixin and IHS Markit said in a.

The NBS data also showed that the country's non-manufacturing sector expanded faster in December, with non-manufacturing PMI coming in at 55 in December, up from 54.8 in November.

Andrew Harker, associate director at IHS Markit, which compiles the survey, said "The Vietnamese manufacturing sector recorded a welcome return to growth of output in December, supported by a solid and accelerated increase in new orders".

Demand from North American customers was particularly strong during December, the report found. The pace of job creation was the strongest since September.

A PMI sub-reading for production fell to 54 from 54.3 in November, but was bang in line with the average over the last six months.

Factory Purchasing Managers' survey from euro area and the United Kingdom are due on Tuesday, headlining a light day for the European economic news.

The Caixin survey showed Chinese manufacturers ramped up buying activity at the fastest rate in four months in December to meet higher production needs.




"Interestingly, the wages component dipped in December, but at 60.2 it does point to the prospect of some pick-up in wages growth", Mr Oliver said.

"Panellists commented on reduced volumes of new business".

In China, manufacturing growth unexpectedly picked up to a four-month high in December amid a surge in new orders, suggesting continued strength in global trade.

Smith said the PMI not only posted the highest reading ever recorded since the survey began in 1996, but its current 37-month sequence of improving business conditions also beat the previous record set in the runup to the financial crisis.

Higher prices for raw materials such as steel and other metals pushed up input costs in December, and this in turn led to another push up in prices charged by manufacturers, the data showed. "As consumer spending recuperates, firms were restricted in their ability to pass on higher cost burdens to clients which further placed upward pressure on firms' margins".

"Challenges remain as the economy adjusts to recent shocks, but the overall upturn was robust compared to the trend observed for the survey history", Dodhia said.

"Given the strong conditions evident in the manufacturing sector, it is no surprise to see that firms are upbeat about the outlook", Philip O'Sullivan, economist with Investec, said.

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