S&P Global Asean PMI retreats to 51.5 in May

  • Economy
  • Monday, 05 Jun 2023

A garments / shirt manufacturing plant in Bandung, Indonesia. - courtesy of Oxwhite

KUALA LUMPUR: The S&P Global Asean manufacturing Purchasing Managers’ Index (PMI) ) remained above the 50.0 mark for the 20th successive month in May, signalling sustained improvement in operating conditions.

However, the latest reading stood at 51.1, down from 52.7 in April as output, new orders and pre-production stocks all grew at softer rates than the previous month, according to S&P Global Market Intelligence.

"The latest PMI data for Asean indicated a modest improvement in operating conditions midway through the second quarter. Moreover, the data signalled a further cooling of inflationary pressures and supply chains improved for the third consecutive month.

"However, there was a slowdown in overall growth momentum. Manufacturers reported softer rates of expansion for both new orders and output. Additionally, firms cut back on their staffing levels for the third month running. Confidence also dipped across the region to a 34-month low,’’ S&P Global economist Maryam Baluch said in a note today.

Baluch said the data suggest that underlying demand trends are softening across the region.

"Bar Philippines, all of the Asean nations covered by the survey registered a fall in its headline PMI in May,” she noted. "However, improvements in supply chains and a further easing of cost pressures could help to support the sector’s recovery in the months ahead.”

In May, five of the seven Asean constituents saw improvements in the health of their manufacturing sector in May.

Leading the upturn for the second consecutive month was Thailand with a reading of 58.2. The expansion was softer than April’s record-high, but nevertheless the second-strongest in the survey history.

Similarly, manufacturing firms in Myanmar registered slower growth as the headline figure stood at 53.0, slipping to a three-month low from the survey high recorded in April.

Philippines was the only country where the headline index increased in May. At 52.2, manufacturers signalled a modest upturn overall.

Singapore and Indonesia's PMI stood at 51.2 and Indonesia 50.3, respectively, indicating softer improvements in manufacturing conditions in May.

Malaysia (47.8) and Vietnam (45.3) were the only two countries reporting a deterioration in business conditions, for the ninth and third consecutive months, respectively. - Bernama

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