Manufacturing improves in August

PETALING JAYA: Malaysian manufacturing conditions signalled an improvement in August, the first time in seven months, on the back of growth in new orders and a faster rise in output.
The Nikkei Malaysia Manufacturing Purchasing Managers’ Index (PMI) rose to 51.2 in August from 49.7 in July, an IHS Markit survey showed.
The Nikkei Malaysia Manufacturing PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 450 industrial companies.
Additionally, IHS Markit economist Aashna Dodhia said that the PMI price indicators signalled easing inflationary pressures during August, which may have played a key role in boosting customers’ purchasing power.
“Indeed, output charge inflation was only fractional as input cost inflation moderated to the weakest since February 2015, reflective of the abolition of the goods and services tax in June,” Aashna added.
She also noted that Malaysian manufacturing companies raised their purchasing activity for the first time in nine months due to stronger demand as well as stock building initiatives undertaken by manufacturers ahead of the re-implementation of the sales and service tax.
Looking ahead, Aashna said that the business sentiment towards the 12-month outlook for output strengthened to a four-month high, with confidence rooted in positive forecasts of sales and an expected improvement in underlying demand.