ASEAN Manufacturing Sector Improves Mildly in June 2023

The latest ASEAN PMI data revealed a modest improvement in manufacturing conditions across the region in June.

IDXChannel - The latest ASEAN PMI data revealed a modest improvement in manufacturing conditions across the region in June. Both production and new orders expanded in June. However, trends diverged as growth in manufacturing production softened to a sixmonth low, while factory orders expanded at a slightly quicker rate. 

“The ASEAN manufacturing sector saw a further improvement in business conditions in June, though the rate of growth was notably softer than that seen at the start of the quarter," said Maryam Baluch, S&P Global Market Intelligence economist in a media release on Monday (3/7/2023).

The headline S&P Global ASEAN Manufacturing Purchasing Managers’ Index (PMITM) posted 51.0 in June, down from 51.1 in May. The headline figure has now fallen for two consecutive months, with the latest reading signalling the least marked improvement in operating conditions since March.

Data broken down by country indicated that five of the seven ASEAN constituents monitored by the survey reported stronger business conditions in June. Leading the upturn was Thailand. Though solid (PMI at 53.2), the rate of growth slipped further from April’s record-high, signalling a much softer expansion during June.

Clustered together, growth across Singapore (52.7) and Indonesia (52.5) was modest overall. That said, the rates of expansion accelerated across both nations, pointing to the strongest upticks in seven and two months respectively. Moreover, they were the only two countries to record stronger growth in June.

As has been the case since February 2022, Filipino manufacturers registered an improvement in the health of its manufacturing sector. That said, the  seasonally adjusted headline figure (50.9) was the second-lowest observed in the aforementioned sequence, signalling only a modest improvement overall.

Manufacturing firms across Myanmar also reported a slight improvement in operating conditions. Though much weaker than the survey-high recorded in April, a reading of above 50.0 was still a positive development for this sector which has been in decline for most of the last three years.

The headline numbers from Malaysia and Vietnam continued to signal deteriorating business conditions, with contractions recorded for the tenth and fourth month running respectively. While Malaysian manufactures signalled the quickest deterioration since January (47.7), manufacturing firms across Vietnam indicated a shallower downturn (46.2) than compared to the sharp reduction reported in the preceding survey period. (WHY)