HBL Manufacturing PMI edges down to a 6-month low

November 02, 2026 (MLN): The seasonally adjusted HBL Pakistan Manufacturing Purchasing Managers' Index, compiled by S&P Global, edged down to 50.8 in October from 50.9 in September. The reading remains above the 50.0 mark that separates growth from contraction, but points to only a marginal improvement in operating conditions.

At the same time, underlying indicators point to higher inflationary risks, as a sharp increase in input costs weighed on production activity. Input price inflation hit its highest level since data collection began in May 2024 as survey respondents pointed mainly to higher raw material prices, especially fuel and fabrics.

Manufacturers passed more of the burden on to customers, lifting selling prices at the fastest rate since April. This highlights the growing challenges facing the manufacturing sector amid elevated energy prices and persistent disruptions across the Middle East.

New orders returned to growth after contracting in September, supported by improved product quality and a recovery in domestic demand.

In contrast, export orders fell for the first time in six months and recorded their sharpest fall in over a year, as higher prices and regional disruptions weighed on external demand. Employment levels declined for the first time since May, reflecting firms' efforts to contain costs amid intensifying input-price pressures.

Humaira Qamar, Head of Equities & Research HBL, commenting on the latest PMI data: “Business confidence softened to a three-month low, as inflation concerns and higher raw material costs weighed on demand expectations. The sharp escalation in price pressures raises concerns over potential second-round inflationary effects. Against this backdrop, the SBP's measured 50bps rate hike to 12.0% reflects a prudent approach in balancing the improvement in economic activity against persistent inflationary and geopolitical risks. Looking ahead, monetary policy is likely to remain data-dependent, with upcoming inflation readings serving as a key determinant of the future policy trajectory.”

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