November Manufacturing Data Points To Improved Trends In Asean
November data pointed to further improved trends across the ASEAN manufacturing sector. The PMI remained above the 50.0 mark to signal another improvement in manufacturing conditions, buoyed by a further increase in factory production, with the rate of output growth easing only slightly from October’s survey record, says Lewis Cooper, Economist at IHS Markit
“Demand conditions also strengthened in November, reflected in a back-to-back uplift in new orders. The rate of expansion in new work did ease noticeably on the month, however, in part due to a further decline in export order book volumes.
“Moreover, across the seven constituent nations, only Myanmar saw a decline in manufacturing conditions
during November. Even here, the rate of contraction softened to the slowest since January. Elsewhere,
growth remained broad-based, with Indonesia and Malaysia registering the fastest rates of improvement in
manufacturing conditions.
“Overall, the latest data provide some promising signs, with the ASEAN manufacturing sector continuing to
recover, and rates of growth in output and new work sticking close to their recent peaks.”
Following a return to growth in October, the ASEAN manufacturing sector remained in expansion territory during November, according to the latest IHS Markit Purchasing Managers’ Index (PMITM) data. Both output and new orders rose further, with the rates of growth remaining close to recent peaks despite easing slightly, while firms cut jobs at the weakest rate for five months.
The headline PMI posted above the 50.0 mark for the second month running in November. The latest reading was down from October’s survey high of 53.6, to 52.3 in November, but was nonetheless indicative of one of the quickest improvements in ASEAN manufacturing conditions on record.
Growth was again broad-based across the seven constituent ASEAN nations, with the exception of Myanmar. Indonesia recorded the fastest rate of expansion, with the PMI (53.9) signalling a sharp improvement in manufacturing conditions. A near-record expansion was also recorded in Malaysia, with the headline index ticking up to the fifth highest on record at 52.3, and indicative of a solid upturn overall.
Elsewhere, stronger rates of growth were registered in both Vietnam and the Philippines during November. In the former, the PMI hit a six-month high of 52.2, while the headline index for the Philippines (51.7) was the highest since March and signalled a moderate improvement in operating conditions.
At the same time, Singapore recorded a sustained improvement in the health of its manufacturing sector midway through the fourth quarter. The PMI (52.2) dipped to a three-month low but nonetheless pointed to a moderate rate of expansion overall.
November data also pointed to ongoing supply issues. Lead times for inputs lengthened again, although delays were the least widespread since April. Nonetheless, supply constraints were again reflected in firms’ costs during November, as the rate of input price inflation remained among the fastest on record, despite easing. Factory gate charges rose at the quickest pace since October 2013 as a result.