Indonesia PMI June 2017


Indonesia: Manufacturing PMI falls into contractionary territory in June

July 3, 2017

The IHS Markit Manufacturing Purchasing Managers’ Index (PMI) swung from May’s 50.6 to 49.5 in June. As a result, the PMI now sits below the 50-point threshold, which indicates an overall deterioration in business conditions.

According to the release provided by Nikkei and IHS Markit, stagnating orders caused output to fall, driving the downturn in the index. Jobs were shed for the ninth consecutive month, while purchasing costs rose in June. Despite these bad omens, firms maintained a positive view on future production, signaling firm confidence. Moreover, for the second quarter as a whole the PMI pointed to healthy expansion in the manufacturing sector.

FocusEconomics Consensus Forecast panelists see fixed investment rising 5.7% in 2017, which is unchanged from last month’s estimate. For 2018, the panel expects fixed investment to increase 6.3%.

Author: Angela Bouzanis, Senior Economist

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Indonesia PMI Chart

Indonesia PMI June 2017 1

Note: Nikkei Indonesia Manufacturing Purchasing Managers’ Index. Readings above 50 indicate an expansion in the manufacturing sector while readings below 50 indicate a contraction.
Source: Nikkei and IHS Markit.

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