MANUFACTURING activity continued to improve at the start of 2023 with the PMI gaining for a third month in a row.

S&P Global reported on Wednesday that the S&P Philippines Manufacturing PMI rose to a seven-month high of 53.5 in January, up from 53.1 the previous month.

The result "signaled strong gains across the... sector at the beginning of 2023," it said in a statement.

"Firms raised their production levels and sharply bumped up their buying activity as a strong and accelerated upturn in new orders was reported in January," it added.

PMI readings above 50 indicate expansion, while readings below 50 indicate contraction. The index, which measures business economic activity, compiles responses about new orders, output, employment, supplier delivery times, and purchase stocks.

Output expanded for a fifth month in a row with production levels up sharply. Anecdotal evidence pointed to increasing demand for Filipino manufacturing goods, S&P Global said. Exports from the Philippines rose for the first time in 11 months in January, helped by strong demand from China.

Firms also had to tap inventories to meet demand with destocking seen as "slight" by manufacturers.

Optimism among manufacturers, meanwhile, rose from December's four-month low to above the historical average, according to S&P Global's latest survey. Hiring, however, remained weak with the index for this nearing 50.0 as layoffs and resignations weighed on job creation.