Wednesday, 17 May 2017
- Manufacturing PMI survey points to continued strength in activity and reviving global demand
- The external sector received a lift as shipments of electronics, in particular phones, gathered pace
- Low food inflation is keeping price pressures in check, despite higher costs of energy and health care
All is well
Rating agency Moody’s changed the outlook on Vietnam’s ratings to positive from stable – a welcome development on the back of robust high frequency data. The latest PMI survey showed that overseas demand in April was the highest in recorded history, and that manufacturers remained strongly confident that output will increase over the coming 12 months, thanks to expectations of higher new orders and business expansion plans.
Vietnam has become an important node in the regionally dispersed supply chain for electronics, especially for mobile phones, which is the country’s biggest export item. Interestingly, shipments of phones and spare parts recovered remarkably from the slump in March, just as we expected. Further, we think that new product launches and a gradual revival of global demand, which is reflected in the sustained increase in overseas orders in PMI surveys, will keep exports buoyant in the quarters to come.
For full report, please find it attached.
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