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Malaysia PMI January 2022

Malaysia: Manufacturing PMI ebbs in January

The Manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, logged a marked slowdown the outset of 2022, falling to 50.5 in January from 52.8 in December. As a result, the PMI moved closer to the 50-threshold that separates improving from deteriorating conditions in the manufacturing sector, as compared to the previous month.

January’s figure was significantly influenced by surging price and supply pressures, as reported supply chain delays and raw material shortages led to sharp input cost increases, which were promptly passed on to consumers. This, in turn, likely hampered both new business and output, and led to stagnating employment levels. Meanwhile, confidence over the coming 12 months reached its highest level since April 2021, as expectations that a waning pandemic could lead an improvement in demand gave firms reason for optimism.

Commenting on January’s downturn, Chris Williamson, chief business economist at IHS Markit, said:

“Malaysia’s manufacturers reported a new downturn in January as the Omicron variant created further headwinds for manufacturers around the world, dampening demand and exacerbating existing, unprecedented supply chain delays. However, the downturn looks to be only mild in comparison to previous waves of the pandemic and will likely be short lived.”

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