In May, the manufacturing sector returned to expansion while services activities maintained their growth, according to the latest Purchasing Managers’ Index (PMI) report.
The PMI highlighted ongoing robust economic activities, bolstered by lower prices and interest rates.
The manufacturing sector PMI surged to 58.2 in May, a significant recovery from April’s 42.0, affirming a rebound in manufacturing activities. The April contraction was attributed to extended holidays during traditional New Year celebrations.
May's increase in production activities was largely due to more working days, as noted by most survey respondents.
All sub-indices under the manufacturing PMI, except for employment, showed growth. Employment neared the neutral level in May.
Under the PMI, an index value of 50.0 separates expansion from contraction. Notably, the new orders and production sub-indices saw significant rises, driven by growth in the food and beverage manufacturing sector, indicating a revival in consumer demand.
Despite the overall positive outlook for the next three months, some respondents expressed concerns about container availability issues in the global shipping industry.
The services sector recorded an index value of 55.0 in May, slightly down from 56.7 in April, yet still indicating continued expansion. Growth was observed across various business sectors, with financial services benefiting from declining interest rates. Transportation saw substantial growth, followed by telecommunications, real estate, health, and professional services.
However, there was a decline in activities in the accommodation, food, and beverage sectors due to a drop in tourist arrivals in May compared to April. Wholesale and retail trade activities also dipped following the end of the festive season.
Despite these sectoral declines, participants in the services sector remain optimistic about sustained business growth over the next three months, supported by favorable macroeconomic conditions.
