Business conditions in the Vietnamese manufacturing sector continued to improve slightly in September amid a renewed expansion of new orders, according to the latest report released by the S&P Global on October 1.

Output and purchasing activity also increased, but firms continued to lower their staffing levels. Meanwhile, inflationary pressures strengthened.

The S&P Global Vietnam Manufacturing Purchasing Managers' Index (PMI) was unchanged at 50.4 in September, signalling a further slight strengthening in the health of the sector.

A more stable economic environment is expected to help lead to higher new orders and subsequently an increase in output over the coming year, according to the report. Public sector investment is also predicted to support growth. While firms remained optimistic about the year-ahead outlook, the level of sentiment dropped from August and was weaker than the series average.