HBL Pakistan’s Manufacturing PMI hits 52.8 in December

Pakistan’s manufacturing sector picked up pace in December, with the HBL Pakistan Manufacturing PMI, compiled by S&P Global, rising to 52.8 from 52.3 in November, the strongest reading since February.

The increase reflects solid growth in production and a surge in demand, with new orders expanding at their fastest rate since March.

Notably, new export orders grew for the first time in six months, supported by stronger international demand and enhanced product standards, according to a press release issued.

Despite rising output, capacity pressures remained low as work backlogs fell at one of the fastest rates on record.

Employment in the sector also rose for the second consecutive month, with firms citing heavier workloads and longer hours in anticipation of stronger order inflows.

Meanwhile, input purchases climbed again, as manufacturers stockpiled raw materials to guard against potential price increases, driving inventories to their largest increase since the survey began.

Humaira Qamar, Head of Equities & Research at HBL, highlighted the positive outlook: “Business confidence strengthened to its highest level since July, bolstered by expectations of improved economic conditions and manageable inflation.

This optimism was mirrored by the State Bank, which surprised markets with a 50bps rate cut, signaling confidence in inflation averaging within the 5-7% range and in achieving its June 2026 foreign exchange reserve target.”

The PMI, based on monthly surveys of private sector firms, tracks changes in output, new orders, employment, and inventories.

It is a potential leading indicator of economic momentum, often signaling shifts in the broader business cycle.