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, new orders fell sharply, and companies reduced employment, purchasing activities and inventories.

“June saw a softening of international demand for Vietnamese manufactured goods as the impact of tariffs intensified. A sharp fall in exports contributed to a further decline in total new orders… Business confidence has recovered somewhat in recent months, but the positive sentiment is largely based on hopes of a more stable picture in the near term. Whether that will actually happen remains to be seen,” said Andrew Harker, chief economist at S&P Global Market Intelligence.

The positive point of this PMI survey is that companies continue to increase production, but this is unlikely to continue for long without an improvement in demand. The first half of 2025 is full of volatility and uncertainty, especially related to trade activities, S&P Global experts also said.

The survey found that the performance of retailers deteriorated sharply and the decline was the largest since February. In addition, input costs also rose again, forcing manufacturers to raise prices and ending a five-month streak of price cuts. Business confidence recovered to its lowest level and below the average level compared to the history of the PMI index.

In the first 6 months of this year, the PMI index was only above the 50-point threshold in March 2025, reaching 50.5 points and 5 months below the 50 threshold, reflecting a picture of aggregate demand in a state of decline, the biggest impact given was due to the influence of US tariff policy.

GB

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