Lockdown measures pressured manufacturing sectors in ASEAN regions causing a decline in factory production and new orders. Operations too were on a sharp downfall, according to IHS Markit August report.
Export demand weakened in August, as new export orders declined for the third consecutive month, although the rate of reduction eased since July. ASEAN manufacturers reduced purchases in June which were further lowered in August, thus widening the rate of decline in purchase activity. Subsequently, inventories declined further. Supply chain disruptions remained substantial.
Inflationary pressures remained elevated in August. Input costs increased substantially with firms raising average charges at a faster pace.
The PMI stood at 44.5 in August slightly below July’s 44.6 indicating a drop in the manufacturing sector driven by a fall in each of the constituent nations which reported a deterioration for the first time since May.
The steepest decline was in Myanmar followed by Vietnam. Both nations struggled to contain the ongoing COVID-19 outbreak. Malaysia and Indonesia also reported sustained deteriorations although the rate of decline had eased since July.
Singapore and the Philippines recorded renewed contractions while the Philippines’ latest index signalled a deterioration for the first time since May. Thailand’s PMI dipped marginally in August.