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Manufacturing recovery slows in December
The manufacturing Purchasing Managers’ Index (PMI) dropped to 53.5 in December, suggesting a continued expansion of activity for the fourth month in a row, albeit at a slower pace.
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Quality control: A worker inspects the quality of a product at a steel factory in the Cikarang industrial estate in Bekasi, West Java, on Oct. 4, 2019. (Antara/Fakhri Hermansyah)
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ndonesia’s manufacturing activity expansion has slowed down as supply chain issues and price pressures remain despite the easing of pandemic-related mobility restrictions.
The manufacturing Purchasing Managers’ Index (PMI) was recorded at 53.5 in December, marking a slowdown from November, according to London-based business information provider IHS Markit.
The index, a gauge of manufacturing activity expansion from a month earlier based on a survey on 400 manufacturers, has been in the expansionary territory, above the 50-point threshold, for four consecutive months.
“The pace of recovery across the Indonesian manufacturing sector slowed in December,” economics associate director Jingyi Pan was quoted in a press release as saying on Monday.
“Although the output subindex showed a sharper rate of growth for production, there was a further slowdown in growth of demand, with total new work expanding at the softest pace for four months.”
The manufacturing sector, a key contributor to Indonesia’s GDP, recorded the slowest rate of expansion since September, despite the peak spending season of Christmas and New Year.
While growth in domestic demand slowed, Indonesian manufacturers reported a strong rebound in demand from abroad, according to IHS Markit.
