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Factory activity rebounds thanks to eased pandemic curbs
IHS Markit’s manufacturing Purchasing Managers’ Index (PMI) for Indonesia rebounded to 52.2 in September from 43.7 in August, marking a return to expansion territory after two months of contraction.
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Quality control: A worker checks the product of a steel factory in the Cikarang industrial estate of Bekasi, West Java, on Oct. 4, 2019. (Antara/Fakhri Hermansyah)
F
actory activity in Indonesia rebounded in September as the government eased movement restrictions imposed in the summer to contain the spread of COVID-19, but manufacturers face supply constraints.
The manufacturing Purchasing Managers’ Index (PMI) stood at 52.2 in September, marking a rebound from 43.7 in August, London-based business information company IHS Markit reported on Friday.
September’s reading, which is above the 50-point threshold separating contraction and expansion, indicates that manufacturing activity was expanding again following contraction in July and August when the government imposed the emergency mobility curbs.
“The Indonesian manufacturing sector saw a turnaround in performance during September,” Jingyi Pan, economics associate director of the company, was quoted in the press release as saying. “The effects of the improving COVID-19 situation and slight easing of restrictions were well captured by the data.”
The manufacturing sector, the largest contributor to Indonesia’s economy, picked up pace as the government allowed export-oriented businesses to operate even in areas where restrictions were still in place.
Read also: Indonesia factory activity contracts for second straight month in August
While output and new orders increased, demand from abroad remained weak in September as pandemic-induced disruptions still occurred, causing some shipping bottlenecks. Pressure on the supply chains caused pressure for manufacturers.
