FX.co ★ Philippines Manufacturing PMI Dips into Contraction

The S&P Global Philippines Manufacturing PMI declined to 49.9 in September 2025 from 50.8 in August, indicating a slight move into contraction for the first time since March and only the third instance in over four years. This decrease was driven by renewed reductions in output and new orders, as sales were impacted by diminished domestic demand, adverse weather conditions, and restrictions on rice imports. Nonetheless, there was an improvement in foreign orders, which somewhat mitigated the overall weakness. Manufacturers increased their purchasing activity and stockpiled inputs, though at a more restrained rate, while inventories of finished goods decreased as backlogs were cleared. Employment conditions remained stagnant, showing little evidence of job expansion despite ongoing activity. Regarding pricing, input cost inflation eased from August’s eight-month peak but persisted as the second fastest rate this year, resulting in only marginal increases in selling prices. Despite a slight dip in business confidence, it remains among the highest levels since late 2024, driven by optimistic expectations for stronger sales in the future.