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View all search resultsManufacturing PMI hits 7-month high in September on stronger demand
The stronger PMI reading, however, contrasts with the latest Industry Confidence Index (IKI) from the Industry Ministry, which showed a slowdown in manufacturing activity expansion in September.
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Workers assemble electric cars at a BYD production facility in Subang, West Java, on Sept. 3, 2026. (Antara/Hafidz Mubarak A)
I
ndonesia’s manufacturing sector rebounded into expansion in September on stronger domestic and export demand, although the government’s industry confidence index pointed to a slower pace of activity amid rising logistics and fuel costs.
The S&P Global Purchasing Managers’ Index (PMI) increased from 49.8 in August to 52.4 in September, exceeding the 50-point threshold that separates expansion from contraction.
The rebound was led by stronger demand, as new orders increased at the fastest rate since February, supported by rising demand and the start of new projects. Export orders also increased for a second consecutive month and at the fastest rate since May 2022.
The improvement in new business translated into a renewed increase in manufacturing output. Production rose at the fastest pace since February, with manufacturers citing stronger customer demand, new projects, improved purchasing power and expanded product ranges.
Manufacturers also increased employment in September to support higher workloads, marking only the third month of job creation so far this year. The rate of employment growth was the fastest since February 2025.
Read also: Textile industry urges govt to refocus support
Despite the increase in capacity, backlogs of unfinished work rose at the strongest rate in five years, suggesting manufacturers continued to face pressure to fulfill incoming orders. Finished-goods inventories also fell at the fastest rate since August 2020 as companies drew down existing stocks to meet demand.
