IHS Markit: Asean manufacturing conditions picked up pace in April

IHS Markit economist Lewis Cooper said the April PMI data point to a much improved performance for the Asean manufacturing sector, with clear signs that the recovery has begun.

KUALA LUMPUR: Asean manufacturing conditions improved at a noticeably quicker rate in April this year to 51.9 from 50.8 recorded in March, according to the latest IHS Markit Purchasing Managers’ Index (PMI) data.

It said central to the stronger performance of the sector was the fastest upturn in output since July 2014 and the steepest rise in new orders since May 2013, coupled with improved business confidence, with firms optimistic towards the year-ahead outlook.

IHS Markit economist Lewis Cooper said the April PMI data point to a much improved performance for the Asean manufacturing sector, with clear signs that the recovery has begun and the sector was beginning to make headway towards recouping lost ground.

"The Asean manufacturing sector appears to have turned a corner in April. Business conditions improved at the fastest rate since July 2014 amid a stronger upturn in output, while the latest growth of new orders was the fastest since May 2013.

"Subsequently, firms registered the most upbeat outlook towards the year ahead since January 2020, with confidence largely in line with the series average, ” he said in a statement today.

Cooper noted that supply delays were again evident, albeit less intense, as average lead times for inputs lengthened to the smallest extent since last November, hinting at subsiding supply chain pressures as we enter the second quarter of the year.

"Nonetheless, costs continued to soar in April, with the rate of inflation among the quickest on record, ” he added.

Across the seven constituent nations, Vietnam saw the strongest growth with its headline PMI hit a near two-and-a-half-year high of 54.7, signalling a sharp rate of expansion.

Following closely behind was Indonesia, where the PMI hit a record high since early-2011 of 54.6, pointed to a marked improvement in overall manufacturing conditions.

Growth was also recorded in Malaysia, where the headline index climbed to 53.9, the fastest growth since mid-2012.

Thailand also saw a return to expansion during the month of April at 50.7, an indicative of only a mild rate of growth.

Meanwhile, Singapore and the Philippines both registered renewed contractions in April at 49.5 and 49.0, respectively.

Myanmar also recorded its steepest downturn of the seven monitored nations of 33.0, as ongoing factory closures amid political instability continued to weigh heavily on the manufacturing sector. - Bernama