ASEAN manufacturing sectors sees modest improvement in Aug: S&P Global

However, growth cooled on the month, as weaker expansions in output and new orders were recorded, the latter in part dragged down by the ongoing decline in new export sales.

Meanwhile, employment slipped back into contraction territory.

A slightly more subdued performance of the manufacturing sector was accompanied by cooling inflationary pressures. Both cost burdens and selling prices rose at weaker rates in August, the upticks softer than their respective series averages.

The headline S&P Global ASEAN manufacturing purchasing managers’ index (PMI) fell from 51.6 in July to a four-month low of 51.1 in August.

ASEAN goods producers reported an eighth successive month of improvement in their health, and one which was modest overall.

August data noted strengthening underlying demand trends, as expansions in new factory orders and output were solid overall. However, there were signs of cooling growth as the respective seasonally-adjusted indexes measured an eight- and a four-month low respectively.

Demand in the ASEAN region was largely bolstered by domestic markets, as sales to foreign clients continued to fall in August. The downturn was sharp overall.

Growth in overall new orders supported firms’ decisions to further raise their buying activity in August, the rate of growth quickening slightly from July’s three-month low. Manufactures made further inroads in their holdings, as both pre- and post-production inventories were depleted at stronger rates.

Following two months of slight job creation, August data revealed a renewed, albeit marginal decline in workforce numbers.

Manufacturers also noted a sixth consecutive month of backlog accumulation, pointing to rising pressures on capacity, an S&P Global release said.

Goods producers indicated that cost burdens, and in turn selling prices charged, rose at moderated paces in August. Moreover, price pressures were historically subdued.

Firms remained confident regarding output growth in the coming year. Expectations were the highest since February this year.

Fibre2Fashion News Desk (DS)