Indonesia PMI February 2021

Indonesia

Indonesia: Manufacturing PMI dips in February

March 1, 2021

The manufacturing Purchasing Managers’ Index (PMI) released by IHS Markit dropped to 50.9 in February from 52.2 in January, which had marked the strongest reading since mid-2014. Nonetheless, the index remained slightly above the 50-threshold, signifying improving operating conditions.

February’s decline came on the back of softer increases in both output and new orders. That said, the drop in employment was the softest in one year, while business confidence remained high amid hopes of an end to the pandemic. On the price front, input cost inflation picked up to the fastest pace since October 2018, due to raw material shortages, leading to the quickest rise in output prices since November 2018.

Andrew Harker, economics director at IHS Markit, stated:

“Recent elevated COVID-19 case numbers show that the pandemic continues to disrupt operations. That said, the manufacturing sector remained relatively resilient in February, merely seeing a slowdown in growth rather than any outright contraction in output and new orders."

FocusEconomics Consensus Forecast panelists expect manufacturing output to rise 4.6% in 2021, which is down 0.7 percentage points from last month’s forecast. In 2022, manufacturing is seen growing 4.5%.


Author: Massimo Bassetti, Senior Economist

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