Malaysia: Manufacturing PMI falls into negative territory in August
September 3, 2020
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, receded to 49.3 in August, from 50.0 in July. As a result, the index slid below the 50-threshold that separates expansionary from contractionary conditions in the manufacturing sector.
August’s drop was largely attributed to increased job shedding, with firms cutting jobs at the sharpest pace since the inception of the survey in 2012, and stabilizing output after growing in the previous two months, amid still-subdued demand prompted by Covid-19. In addition, new orders continued to moderate, while new export orders deteriorated further owing to the ongoing impact of restrictions in export markets. On the price front, both input cost and output charge inflation softened. Lastly, although businesses remained optimistic in August, sentiment eased as worries over Covid-19 lingered.