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Indonesia PMI April 2024

Indonesia: Manufacturing PMI falls in April

The S&P Global Indonesia Manufacturing Purchasing Managers’ Index (PMI) fell to 52.9 in April from 54.2 in March. As such, the index remained above the 50.0 no-change threshold but signaled a softer improvement in manufacturing sector operating conditions compared to the previous month.

In April, the Indonesian manufacturing sector’s growth moderated due to slower increases in production and new orders. Despite this, firms continued to raise their purchasing activity—albeit at the softest pace since last November—in anticipation of future growth. This was underpinned by a sustained, albeit subdued, demand for manufactured goods primarily from the domestic market. Meanwhile, export sales declined for a second consecutive month, marking the most significant drop since February 2023.

Prices in the Indonesian manufacturing sector saw another steep increase in April, continuing a trend that began in December 2019. This was attributed to a broad-based rise in raw material prices and unfavorable exchange rate movements that increased the cost of imported goods. Nevertheless, April saw a slight decrease in the rate of output price inflation from March’s 21-month high. Meanwhile, business sentiment dropped to its lowest in nearly four years, leading to cautious employment strategies, including temporary layoffs, as firms navigated the pressures of rising costs and softened confidence.

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