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Malaysia PMI October 2023

Malaysia: Manufacturing PMI stable in October

The S&P Global Manufacturing Purchasing Managers’ Index (PMI) came in at 46.8 in October, matching September’s reading, the joint-weakest result since January. As a result, the index remained below the 50.0 no-change threshold, signaling a continued deterioration in manufacturing sector operating conditions from the previous month. October’s reading was indicative of a stagnation of the Malaysian economy on a year-on-year basis.

Output softened at the fastest pace since January. Firms scaled back production as weak global demand conditions drove another slowdown in total new orders and new exports. Consequently, firms let go of staff and employment was reduced at the fastest pace since June 2022.

Turning to prices, input costs increased at the steepest-pace in eleven months due to a weaker currency and higher raw material costs. Even so, selling prices rose but only slightly from the prior month. Lastly, firms in the sector remained optimistic regarding output expectations for the year ahead, driven by hopes that customer demand will strengthen.

Commenting on the release, Usamah Bhatti, economist at S&P Global Market Intelligence, stated:

“Malaysian manufacturers continued to endure a challenging time at the end of the third quarter, with reports of demand weakness widespread in the latest PMI survey, causing stronger moderations in output, new orders and exports. Although the latest figures are still representative of growth in official GDP numbers, the current soft patch looks set to continue over the coming months.”

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