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Manufacturing activity reaches record-high in October
Manufacturing activity in Indonesia has reached a record-high, but supply shortages are causing concern about rising input costs.
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Final check: A worker inspects the quality of the product at a steel factory in the Cikarang industrial estate of Bekasi, West Java, on Oct. 4, 2019. (Antara/Fakhri Hermansyah)
Manufacturing activity in Indonesia has reached a record-high as COVID-19 curbs are eased and the year-end spending season nears.
Business information provider IHS Markit reported on Monday that Indonesia’s manufacturing Purchasing Managers’ Index (PMI) rose to 57.2 in October, the highest level since the index started in 2011.
The latest reading marks further improvement in factory activity after the index fell to 40.1 in July, when the government imposed restrictions on business, travel and leisure activity to contain the Delta wave of the coronavirus pandemic.
“The Indonesian manufacturing sector saw the fastest growth on record, according to the latest IHS Markit Indonesia Manufacturing PMI, which reflected improvements brought about by the further easing of COVID-19 restrictions,” Jingyi Pan, economics associate director, was quoted in a press release as saying.
The manufacturing sector is the largest contributor to Indonesia’s economy, and the index usually moves in the same direction as the country’s economic growth.
Manufacturers reported record-high expansion in new work and output, according to IHS Markit. In response to stronger demand, businesses expanded their workforces for the first time in four months.
But foreign demand contracted, in line with constraints on shipping. Manufacturing exports fell 5.29 percent month-to-month (mtm) to US$15.51 billion in September, Statistics Indonesia (BPS) data show.
