KUALA LUMPUR, Oct 2 — Local factory output growth slowed again last month following five consecutive monthly declines in new orders, according to Nikkei Malaysia’s monthly manufacturing index.
In the September edition of its Purchasing Managers Index (PMI), Malaysia fell to 48.9 from 50.4 in August, signalling a contraction. The index considers any score above 50 to indicate an improvement.
“The fall in the PMI was mainly driven by reduced new business, which declined for the fifth successive month,” Nikkei said in the report accompanying the index date.
“Those firms that recorded a decrease in new orders commented on weak underlying demand.”
Malaysian factories remain on a recruitment drive despite the continued weakness in the sector, however, with hiring reaching the highest levels since October 2015.
Local firms also responded to chronic cost increases by increasing their prices last month at the fastest rate since May, Nikkei Malaysia added.
Elsewhere in Asean, the uptick in the regional PMI was not enough to lift the confidence of business owners..
“The Asean manufacturing economy ended the third quarter on a positive note, however an air of caution continued to weigh on confidence across the region,” Bernard Aw, principal economist at IHS Markit, said of the results.
Vietnam led the region with a PMI of 53.3, indicating accelerating growth in the country’s manufacturing. This was followed by the Philippines (50.8), Indonesia (50.4), and Thailand (50.3).
Singapore registered a moderate decrease in its PMI, dropping to 48.6 last month.
