Manufacturing and services sector expands in May

Friday, 16 June 2017 00:00 - - {{hitsCtrl.values.hits}}

The country’s manufacturing and services sectors grew in May as per the Purchasing Managers Index (PMI) compiled by the Central Bank.

It said the Manufacturing Sector PMI recorded 57.9 in May which is an increase of 16.1 index

points compared to April 2017 whilst the Services Sector PMI recorded 55.3 index points in May from 54.2 index points in April 2017.

The gain in Manufacturing MPI indicates that the manufacturing activities recovered in May 2017, largely attributable to the expansion in Production and New Orders subindices, following the seasonal contraction observed for the month of April 2017.

Further, all the sub-indices of PMI apart from Employment sub-index recorded values above neutral 50.0 threshold. However, adverse weather conditions experienced from 25th day of the month slowed down the expected recovery of the operations due to employee absenteeism and lengthening of the suppliers’ delivery time. Nevertheless, the expectation for activities indicates an improvement for the next three months.

The Services Sector PMI recorded 55.3 index points in May from 54.2 index points in April 2017. The moderate acceleration in Services sector was supported by New Businesses, Business Activity and Employment. A recovery of Employment was observed in May following the contraction observed in April 2017. Expectations for Activity decelerated in May due to reasons such as adverse weather conditions and pacing out of peak and festive seasons in certain sub sectors. Backlogs of Work declined, continuing the trend observed since the survey began. Prices Charged decelerated in May 2017 with the decline in demand compared to April. Meanwhile, Expectations on Labour Cost also moderated in May 2017 following the annual increments accommodated in April.