Business conditions deteriorate, PMI below 50 for third consecutive month

(CTO) - The survey results of the Vietnam Manufacturing Purchasing Managers' Index (PMI) in June 2025 only reached 48.9 points compared to 49.8 points in May.

According to S&P Global, Vietnamese manufacturers continued to face weak demand in June, with a sharp decline in new orders, reduced employment, and decreased purchasing and inventory levels.

Andrew Harker, Chief Economist at S&P Global Market Intelligence, said: “June saw weakening international demand for Vietnamese manufactured goods as the impact of tariffs intensified. The sharp drop in exports contributed to a continued decline in overall new orders… Business confidence has recovered somewhat in recent months, but the positive sentiment is largely based on hopes for a more stable picture in the near future. We need to wait and see if that actually happens.”

S&P Global experts also stated that a positive aspect of this PMI survey is that companies continue to increase production, but this is unlikely to be sustainable in the long term without an improvement in demand. The first half of 2025 is expected to be volatile and uncertain, particularly regarding trade activity.

The survey results indicate that retailer performance has declined sharply, the largest decline since February. In addition, input costs have risen again, forcing manufacturers to increase prices and ending a five-month streak of price reductions. Business confidence recovered at its lowest level and was below the historical average of the PMI index.

In the first six months of this year, the PMI index was only above 50 points in March 2025, reaching 50.5 points, while five months were below 50, reflecting a picture of declining aggregate demand, with the biggest impact attributed to the US tariff policy.

GB

Source: https://baocantho.com.vn/cac-dieu-kinh-doanh-suy-giam-pmi-duoi-nguong-50-thang-thu-3-lien-tiep-a188103.html