The headline figure for Nikkei-Markit manufacturing purchasing managers’ index fell to 51.6 in May from 54.1 in April, but remained above the 50-point line separating expansion from contraction.

The rate of expansion in Vietnamese manufacturing output slipped to a four-month low in May with the rise in new orders also easing during the period, the survey found.

Total new business and new exports rose at much weaker rates than those seen in April, while the input cost inflation slowed in May to its weakest pace since June last year.

Manufacturers reduced their output prices as client demand showed signs of weakness, marking the first fall in charges since August.

Concern over client demand was reflected in weaker business sentiment with optimism at a four-year low and one of the weakest readings since the survey began in 2012. However, 47 per cent of manufacturers surveys expect output to rise in the coming year.

Andrew Harker from IHS Markit said : Growth in the Vietnamese manufacturing sector took a step back during May. Output and new orders each rose at much weaker rates, with firms reducing their pace of job creation accordingly. While all these variables remained in expansion territory, confidence dipped to the lowest in almost four years. This suggests some concern among manufacturers that a soft-patch may be around the corner.

By: Alice Woodhouse - The Financial Times - June 1st, 2017