February: Country’s manufacturing output has increased further

KARACHI: Pakistan’s manufacturing production increased further in February, as reflected by the HBL Manufacturing PMI of 54.0 signifying growth for the tenth consecutive month.

The latest reading signaled a solid improvement in the health of the sector, albeit the softest in five months as the PMI dipped from 55.4 in January.

Humaira Qamar, Head Equities & Research - HBL stated, “Output continues to expand with signs of demand resilience, although at a slower pace from January. New orders remained strong & are up for the sixth consecutive month, supported by an equivalent rise in new export orders. This is corroborated by recent data from the central bank, wherein exports of the textile sector (which accounts for nearly a quarter of the survey) posted the highest level in 28 months.

Pakistani manufacturers continued to exhibit confidence that output will increase in the next 12-months as reflected by the Future Output Index trending above 50.0.

Employment and inventory levels ticked higher once again, suggesting a reduction in the sector’s capacity slack. Delivery times lengthened in February with anecdotal evidence indicating that demand for materials, alongside a sharp rise in transportation costs, disrupted timely deliveries“

She further added that “As per the Pakistan Bureau of Statistics, Large scale manufacturing (LSM) contracted 1.8% in the latter half of 2024. However, excluding the hefty decline in the low-weight furniture segment, LSM trended positively. Our PMI release suggests that the recovery has extended into 2025, with demand-side conditions taking cue from a sharp reduction in the policy rate.”

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