KUALA LUMPUR: The S&P Global ASEAN Manufacturing Purchasing Managers’ Index (PMI) edged down to 52.3 in August from 52.8 in July, indicating a slightly softer but still solid improvement in the region’s manufacturing sector.
S&P Global said the moderation was mainly due to slower, although still robust, growth in production.
"Employment and stocks of purchases also declined, marking the fourth reduction in the past four months surveyed, although the falls were only marginal in both cases.
"Backlogs continued to rise at the same pace as in July, signalling persistent and strong pressure on capacity,” it said.
S&P Global said purchasing activity also increased solidly, albeit at a slightly slower rate.
The sector’s key driver was a rapid, near-record rise in new orders, with growth remaining sharp and only slightly below February’s survey high.
"Providing further impetus was a favourable prices picture. Inflationary pressures continued to trend down, with both cost burdens and charges rising at the weakest rates in six months.
"Supply chains also showed signs of recovery, as the latest deterioration in vendor performance was only slight and weaker than that seen in July,” it said.
S&P Global Market Intelligence economist Maryam Baluch said the ASEAN manufacturing sector continued to improve solidly in August, supported by resilient demand conditions, particularly in domestic markets.
She said confidence also strengthened while price pressures eased, suggesting the region is well placed to build further momentum as the year progresses.
"Output growth slowed slightly but remained solid overall. At the same time, the renewed, albeit fractional, declines in employment and stocks of purchases could prove temporary, given rising capacity pressures, continued purchasing activity and signs of recovery across supply chains,” she said.
Meanwhile, confidence in the year-ahead outlook strengthened in August, with the Future Activity Index rising for a second consecutive month to reach a near four-year high, S&P Global said.
"The third quarter is anticipated to be much stronger than the previous period, which was heavily affected by the war in West Asia,” it added. - Bernama
