Rising orders helped push Vietnam’s industrial output growth to its three-year record high, according to the latest HSBC report.
The Purchasing Managers Index (PMI), which tracks manufacturing conditions, rose to 53.1 in April from 51.3 the previous month and surpassed the previous high recorded in April 2011, when the survey began.
Business conditions have strengthened for eight straight months as the PMI remained above 50--the no-change mark. The index is based on new orders, output, employment, supplier delivery times, and stocks of items purchased.
The rate of growth in new orders received by Vietnamese manufacturers, including those from abroad, was the fastest in the survey's history.
Input buying also expanded at a record pace and led to the first rise in stocks of purchases since October 2013. Some surveyed businesses said they expected further growth in coming months.
Job creation also grew again after a small reduction in March.
Trinh Nguyen, Asia Economist at HSBC, commented on the survey by saying that the manufacturing boost will help bolster beleaguered domestic demand.
“The strong bounce of output, new orders, new export orders and employment are much needed to counter balance the domestic slump.”
Nguyen said exports may see another stellar year due to increased investment foreign investment in Vietnam's manufacturing sector and trade negotiations designed to expand market access.
The economic growth forecast increased slightly to 5.6 percent this year from 5.4 percent last year.
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