Manufacturing activity in Vietnam softened during March but remained in the expansionary territory even as the cost of raw materials rose amid the war in the Middle East, S&P Global said in its monthly purchasing managers' index report Wednesday.
The S&P Global Vietnam Manufacturing PMI dropped to 51.2 from February's 54.3 and pointed to the least marked strengthening of operating conditions since last September, the firm said.
A reading over 50 indicates expansion in activity.
Cost-push inflation in Vietnam was expected, given the country's reliance on oil imported from the Middle East, S&P Global said.
Despite the expansion in March, the near-term outlook "appears bleak" as manufacturers pass on the impact of higher input costs to customers, limiting demand.
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