The HBL Pakistan Manufacturing PMI inched up to 51.8 in August 2026, from 51.7 in July, reaching its highest level since the onset of the war. Although the pace of expansion remained modest, underlying demand conditions continued to improve, supported by a combination of stronger domestic orders and sustained growth in export demand.
New orders expanded at their fastest rate in five months, reflecting improved product quality and competitive pricing strategies. Export orders also strengthened for a fourth consecutive month, highlighting resilience in external demand. The improved order environment continued to support manufacturing activity, with output rising at a pace broadly similar to July. However, producers remained cautious in scaling up production amid lingering inflationary pressures.
Manufacturers increased purchasing activity for the third successive month and continued to build inventories in anticipation of stronger demand ahead. Employment levels remained largely unchanged during the month, as selective hiring to meet higher order volumes was balanced by ongoing cost-management measures. Meanwhile, supply-chain conditions improved further, with delivery delays easing to their lowest level since November 2025.
Commenting on the latest PMI data, Humaira Qamar, Head of Equities & Research – HBL, noted “Business confidence regarding output over the next 12 months strengthened in August, reaching one of the highest levels recorded this year. Optimism was underpinned by expectations of sustained sales growth and a moderation in price pressures. While we expect inflation to moderate through the second half of FY27, the disinflationary trajectory is likely to be more gradual and less pronounced than previously anticipated.”
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