Philippines’ manufacturing PMI contracts in September

PHILIPPINE factory activity contracted in September, showing a deterioration for the first time since April, due to a surge in oil prices and weak demand.

The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) fell to 49.6 in September from 54.9 in August. This was the first contraction in five months or since the 48.3 in April.

A PMI reading below 50 shows a deterioration in operating conditions from the previous month, while a reading above 50 signals an improvement.

“Filipino manufacturers reported a notable impact from high oil prices, strong international competition and weak demand during September. Output, new orders and employment all dropped into contractionary territory,” Siân Jones, principal economist at S&P Global Market Intelligence, said in a report.

“Firms also signaled moves into retrenchment mode via a fresh decline in input buying and a running down of inventories,” she added.

S&P said a renewed decline in production contributed to the contraction, with output falling for the first time in nine months and at the sharpest rate since November 2025. Firms attributed the decline to reduced new order inflows and international competition.

Filipino manufacturers also recorded a drop in new sales in September. Although the rate of contraction was only marginal, it marked a reversal from expansions in each of the previous four months.

Similarly, new export orders declined in September, with companies citing higher prices as a deterrent to client purchases amid strong competition. — Justine Irish DP. Tabile