Manufacturing Activity Indonesia Contracts Again in July 2017

Ann Santiago
August 2, 2017

This was signalled by the final IHS Markit Eurozone Manufacturing PMI® posting 56.6 in July, down from June's 74-month high of 57.4 and below the earlier flash estimate of 56.8.

Manufacturing activity across the USA reached a four-month high in July as output increased and new orders rebounded, according to a report Tuesday. "Notably, new export sales increased at the second-fastest rate since September 2014", the press release said.

Ongoing hot weather across China, rainstorms and floods in certain regions, and the fact that some companies conduct routine equipment checks and repairs during summer jointly contributed to the monthly PMI decline, Zhao said. "Sentiment rose to a three-month high as close to 50 per cent of panellists predicted an increase in production", the survey showed.

A PMI figure above 50 represents growth while anything below points to contraction. The National Bureau of Statistics (NBS) said Monday that China's official manufacturing PMI came in at 51.4 in July, down from 51.7 in June.

Compared with the official gauge, the Caixin PMI tends to more closely track small private manufacturers in China that don't benefit as much from government stimulus as state-owned firms. New export sales increased at the second-fastest pace in nearly three years, a sign of robust worldwide demand.

After a slowdown, the manufacturing industry made a good comeback in July 2017 and rose to 55.1, which was above what economists expected.

Commenting on the Malaysian Manufacturing PMI survey data, Paul Smith, director at IHS Markit, which compiles the survey, said the Malaysian manufacturing sector continued to struggle in the face of tepid demand, particularly from within the domestic economy, during July.

Chinese goods producers in July were able to raise output prices the most since March, Tuesday's PMI showed, as input inflation also accelerated, though the price gains were much milder than those seen around the turn of the year.

Manufacturers upped their purchasing activity in July, but as with output and new orders, the rate of expansion weakened. Readings above 50 signal an improvement in business conditions on the previous month, while readings below 50 show deterioration.

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