The IHS Markit Indonesia Manufacturing Purchasing Managers’ Index™ (PMI™) posted 53.5 in December, down from 53.9 in November.
This represented a fourth straight month of improving business conditions across the Indonesian manufacturing sector, though the rate of improvement was the slowest since September.
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"The pace of recovery across the Indonesian manufacturing sector slowed in December, according to the latest IHS Markit Indonesia Manufacturing PMI. Although the output sub-index showed a sharper rate of growth for production, there was a further slowdown in growth of demand, with total new work expanding at the softest pace for four months," IHS Markit Economics Associate Director Jingyi Pan said in a press release on Monday.
"Persistent supply constraints remain a key concern for the Indonesian manufacturing sector, as vendor performance deteriorated further and companies reported steeper price pressures, which had affected production at some firms. It will be important to monitor if this continues to affect production, or even affect the current growth momentum moving forward," the IHS Markit economist added.
Nonetheless, overall sentiment remained highly positive, with the level of business confidence above the long-run average to suggest that Indonesian manufacturers remain optimistic for continued growth in production over the course of 2022.