Indonesia: Manufacturing PMI dips in April
Conditions in Indonesia’s manufacturing sector improved at a slower pace in April, according to the Purchasing Managers’ Index (PMI) released by IHS Markit and Nikkei, with the PMI decreasing from 51.2 in March to 50.4. However, the indicator remained above the 50-point threshold that seperates expansion from contraction in the manufacturing sector.
April’s dip was underpinned by a moderation in output growth, stagnating new orders and slower employment growth. However, exports rose for the first time in nearly 18 months, while input prices fell at a survey-record pace, thanks to the stronger rupiah and low agricultural prices. This fed through to broadly unchanged output prices. Bernard Aw, Principal Economist at IHS Markit, argued: “the slowdown could be temporary, as Indonesian manufacturers continued to expand operating capacity. Factory job creation has now been recorded for almost a year, alongside comments of additional machinery investments”.