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Manufacturing activity hits 11-month high ahead of Ramadan

Strong domestic demand ahead of the fasting month drove Indonesia's manufacturing PMI to a new high last month, but analysts say declining export orders signal trouble ahead amid persisting cost pressures.

Aditya Hadi (The Jakarta Post)
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Mon, March 3, 2025 Published on Mar. 3, 2025 Published on 2025-03-03T17:24:12+07:00

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Manufacturing activity hits 11-month high ahead of Ramadan Workers assemble Alva electric motorcycles at the Cikarang factory PT Ilectra Motor Group (IMG) in West Java, in this undated handout photograph. (Alva Auto/-)
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M

anufacturing activity in Indonesia surged last month to its highest level in nearly a year, driven by an increase in new orders and jobs ahead of Ramadan, but analysts say the long-term outlook is less than rosy.

Consumer demand typically peaks during the Muslim fasting month, which falls in March this year.

According to the latest S&P Global report released on Monday, Indonesia’s manufacturing Purchasing Managers’ Index (PMI) jumped to 53.6 in February from 51.9 in January.

This marks the third consecutive month the index has reached above the critical 50-point threshold separating expansion from contraction.

Based on a survey of purchasing managers from around 400 manufacturers nationwide, S&P Global’s Indonesia Manufacturing PMI report offers a snapshot of business conditions in the sector.

The new orders subindex rose for a third consecutive month in February, marking the strongest growth rate since March 2024.

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To meet higher production needs, manufacturers ramped up input purchases and capacity, leading to the fastest employment growth since the survey began nearly 14 years ago.

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