The headline PMI registered 50.7 in November, down from 51.6 in October. While the latest reading remained above the crucial 50.0 no-change mark, to indicate a tenth monthly improvement in the health of the ASEAN manufacturing sector, the rate of growth was the slowest seen over this period and only
Four of the ASEAN nations covered by the survey reported an improvement in operating conditions in November, compared to three that registered a deterioration. Singapore remained the top performer, with a headline PMI reading of 56.0 (unchanged from October). Though marked, the rate of expansion remained softer than those seen earlier in the year. Conditions also improved across the Filipino manufacturing sector, with the latest PMI figure (52.7) pointing to a strong upturn that was fractionally quicker than that seen in October.
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Thailand (51.1) and Indonesia (50.3) were the only two other nations to report growth across their manufacturing sector. That said, both nations reported a loss of momentum for the second month running, and registered the lowest headline index readings since June.
For the third month running, manufacturing conditions across Malaysia deteriorated in November. Moreover, the headline index hit a 15-month low (47.9). Vietnam also recorded a decline in the health of its manufacturing sector. At 47.4, the respective PMI index slipped below the neutral 50.0 level for the first time since September 2021, and pointed to a solid rate of deterioration.
Myanmar’s manufacturing sector posted the weakest performance overall. Notably, operating conditions deteriorated at the second-sharpest rate since the current run of contraction began in May (PMI at 44.6).
"The ASEAN manufacturing sector reported a slowdown in growth for the second consecutive month during November. The latest upturn was only marginal amid falling factory orders as a result of reduced client activity. The muted demand environment also resulted in a second month of falling input stocks, while firms signalled a decline in workforce numbers for the first time since June," Maryam Baluch, Economist at S&P Global Market Intelligence said in a media release on Thursday.
"While softer demand conditions across the region helped curb inflation, currency weakness and rising raw material and energy prices continued to exert upwards pressure on prices. As a result, more central banks across the region may look to tighten monetary policy, as already seen in the recent interest rate hikes across Indonesia and the Philippines. The slowdown across the region raises the risk of the sector falling into decline in the coming months, as high inflation and tighter financial conditions could weigh further on demand," Baluch added.
Business expectations regarding the 12-monthoutlook for output weakened from October’s multiyear high to the lowest since February, with the index posting below its long-run average.