ASEAN Manufacturing Conditions Deteriorate Further in October 2023

The headline S&P Global ASEAN Manufacturing Purchasing Managers’ Index (PMI) was unchanged from September at 49.6 in October.

IDXChannel - The headline S&P Global ASEAN Manufacturing Purchasing Managers’ Index (PMI) was unchanged from September at 49.6 in October.

Following the first deterioration in operating conditions for just over two years in September, the start of the final quarter signalled a further decline in the health of the ASEAN manufacturing sector.

“The start of the final quarter signalled yet another slight deterioration in operating conditions across the ASEAN manufacturing sector," Maryam Baluch, Economist at S&P Global Market
Intelligence said in a media release on Friday (3/11/2023).

“Looking ahead, global economic headwinds continue to cloud the outlook, including the subdued economicrecovery in China and the lagging effects of monetary policy tightening across the majority of the ASEAN constituents and elsewhere. On the flipside, with inflationary pressures easing, this could help to support sales and revive demand," Baluch added.

Of the seven ASEAN nations covered by the survey, five recorded a deterioration in the health of their manufacturing sector; the highest number of countries to report a decline since August 2021. The downturn was led by Malaysian manufacturers for the fourth month running. Operating conditions there weakened at an unchanged and solid pace (headline PMI at 46.8), thereby indicating the joint-quickest contraction since January.

Thailand’s manufacturing sector also recorded a further deterioration in conditions. At 47.5, the headline figure posted below the neutral 50.0 mark for the third month running. Moreover, the rate of decline was the most pronounced in over two-and-ahalf years. Modest deteriorations in business conditions were noted across both Singapore (48.6) and Myanmar (49.0). However, while the downturn softened across Singapore’s manufacturing sector, Myanmar registered a fresh decline following an eight-month period of improvement.

Vietnam registered a marginal downturn in October, with the rate of deterioration broadly unchanged from that seen in the previous survey period (49.6).

The two countries that saw an improvement in the health of their manufacturing sectors were Indonesia (51.5) and the Philippines (52.4). While the former saw growth momentum ease to a five-month low, operating conditions improved at the fastest pace in seven months at Filipino manufacturing firms. (WHY)