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Indonesia's Manufacturing Sector Returns to Growth in September

Wahyu Dwi Anggoro - 01 October 2021 11:36 WIB
Indonesias Manufacturing Sector Returns to Growth in September
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Jakarta: The IHS Markit Indonesia Manufacturing Purchasing Managers’ Index™ (PMI™) posted 52.2 in September, up from 43.7 in August.

Latest PMI data showed that both output and new orders returned to growth in September after two months of steep contraction. 
Survey respondents highlighted that demand had revived as the COVID-19 situation improved, while the easing of COVID-19 restrictions in some areas helped to boost activity as well.

“That said, while purchasing activity rose in tandem with output, hiring activity remained weak in the sector. Manufacturers’ optimism likewise fell in September even as Indonesian economy improved. It will be important to see if better demand conditions translate to improved business confidence as the sector begins to recover," IHS Markit Economic Associate Director Jingyi Pan said in a press release on Friday.

"Meanwhile supply constraints and sustained price pressures are themes worth watching, though this is not unique to Indonesia and can be seen affecting manufacturers globally," she added.

Despite the supply constraints and lingering mobility restrictions, Indonesian manufactures remained generally optimistic regarding production over the next 12 months, with hopes of further improvements in the COVID-19 situation. 

That said, the level of business confidence dipped slightly since August and was lower than the survey average. 

(WAH)

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