JAKARTA (TheInsiderStories) - Indonesia Manufacturing Purchasing Manager’ Index (PMI) improves to 53.2 in March from 50.9 in February amid sharp accelerations rates of growth in output and new orders, IHS Markit reported today (04/01). It said, there were signs of emerging pressure on capacity, which led firms to stabilize employment.
“The IHS Markit Indonesia Manufacturing posted 53.2 in March, up from 50.9 in February and the highest reading since the survey began in April 2011. The index signaled a solid improvement in business conditions which outpaced the previous survey peak seen in June and July 2014,” wrote the report.
The record improvement in the health sector was registered thanks to accelerated growth of new orders and output, both of which increased to the greatest extent in the decade-long survey so far. Production increased for the fifth month in a row, with panelists generally linking the latest expansion to the rise in new orders.
In turn, those firms that secured greater new order volumes often mentioned stronger client demand. The COVID-19 pandemic continued to impact export business, however. New export orders decreased for the sixteenth successive month, albeit at the softest pace since last November.
Firms were increasingly confident that improvements in output would be sustained over the coming year, with business confidence hitting a 50-month high. An end to the pandemic, sharpest increases in output and new orders in decade-long survey employment stabilizes fastest rise in input costs since October 2018
While, higher raw material costs and supply-chain disruption led to a further acceleration in the pace of input price inflation, but firms raised their own selling prices at a softer pace. The record improvement in the health of the sector was registered thanks to accelerated growth of new orders and output, both of which increased to the greatest extent in the decade-long survey so far.
Production increased for the fifth month in a row, with panelists generally linking the latest expansion to the rise in new orders. In turn, those firms that secured greater new order volumes often mentioned stronger client demand. However, the pandemic continued to impact export business.
New export orders decreased for the sixteenth successive month, albeit at the softest pace since last November. Firms were increasingly confident that improvements in output would be sustained over the coming year, with business confidence hitting a 50-month high.
“The Indonesian manufacturing sector ended the first quarter of the year on a high, with firms ramping up production in response to the strongest influx of new orders in the decade-long survey so far. These positive results add to hopes that the sector is on a fast upward trajectory, with the obvious caveat that the COVID-19 pandemic could hit back at any time,” Andrew Harker, the economics director from IHS Markit stated.
He continued, “Signs of pressure on capacity meant that employment stabilised in March, and if trends in workloads remain positive we can expect outright employment growth in the near future.”
Commenting on the resulted, industry minister, Agus Gumiwang Kartasamita hoped the improvement will encourage the economic growth in the first quarter of 2021. He adds, the government has provided various stimuli to support the manufacturing sector through a fiscal incentives.
Written by Editorial Staff, Email: theinsiderstories@gmail.com
