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Manufacturing cools down anew in January

Factory output sustained its slowdown for the second straight month in January as the fresh surge in coronavirus disease 2019 prompted the government to reimpose stricter mobility curbs.

Preliminary data from the Philippine Statistics Authority’s (PSA) Monthly Integrated Survey of Selected Industries (MISSI) showed manufacturing, as measured by the volume of production index (VoPI), grew by 16.5% year on year in January.

This was slower than December’s revised 21.3% growth and a turnaround from the 14.5% contraction recorded in January 2021.

This is the second month straight the VoPI posted a slower growth. It was also the 10th straight month that factory out posted positive reading.

Sixteen out of 22 industry divisions posted growth in January, led by manufacture of tobacco products which rose by 88.4% annually from -14.5% in December. It was followed by wood, bamboo, cane, rattan articles, and related products (86.8% from 110.3%) and basic pharmaceutical products and pharmaceutical preparations (47.8% from -30%).

Meanwhile, manufacture of wearing apparel (-24.2% from -0.4%) led the decliners that month, followed by leather and related products, including footwear (-6.3% from 0.5%) and chemical and chemical products (-2.3% from 31.5%).

In comparison, IHS Markit’s Philippines Manufacturing Purchasing Managers’ Index ended four consecutive months of growth after hitting the 50 mark in January, signifying no change in manufacturing condition the previous month.

The 50 mark separates manufacturing expansion and contraction.

The capacity utilization — the extent to which industry resources are used in producing goods — averaged 67.9% in January, faster from the revised 67.4% the previous month. Of the 22 sectors, 20 averaged a capacity utilization rate of at least 50%. — A. O. A. Tirona

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