The latest data report released by the financial information company IHS Markit shows that in January 2021, the purchasing managers index (PMI) of ASEAN countries’ manufacturing industries rose from 50.8 in December 2020 to 51.4, which is the continuous manufacturing industry in ASEAN countries. In the second month of expansion.
Manufacturing Purchasing Managers Index above the 50-point dry line indicates that the manufacturing industry is expanding, and below 50-point indicates shrinking. In January 2021, of the seven ASEAN countries covered by the report, three have a manufacturing index below 50.
The seven countries covered by the report are Singapore, the Philippines, Indonesia, Vietnam, Thailand, Malaysia and Myanmar. In January, Singapore’s manufacturing industry was in a state of expansion for the fourth consecutive month. The PMI rose from 55 in December 2020 to 55.9, the highest among seven countries; the manufacturing PMI of the Philippines rose from 49.2 in December 2020 to 52.5, reaching 52.5. The highest level since December 2018 means that the country’s manufacturing industry has ended three consecutive months of contraction and has slightly expanded; Indonesia’s manufacturing PMI rose from 51.3 in December 2020 to 52.2, the highest in six and a half years It also marks the third consecutive month of expansion in the country’s manufacturing industry; Vietnam’s manufacturing PMI fell from 51.7 in December 2020 to 51.3, but it still shows that the country’s manufacturing sector is still expanding slightly.
After Thailand’s manufacturing PMI was above the 50-point decline line for three consecutive months, it fell from 50.8 in December 2020 to 49 in January, which means that the country’s manufacturing sector shrank slightly that month; In a shrinking state, the manufacturing PMI fell from 49.1 in December 2020 to 48.9; Myanmar’s manufacturing PMI rose for the third consecutive month, from 44.7 in December 2020 to 47.8, which means that the country’s manufacturing industry shrank in January The rate dropped to the lowest level after June 2020.
The core reason for the strong growth of manufacturing PMI in ASEAN countries in January was the rapid increase in factory output and new orders that month. According to the report, the output growth rate of the manufacturing industry in ASEAN countries in January reached the highest level in more than two and a half years, and the increase in new work volume also reached a new high since July 2014.
At the same time, as demand improves again, manufacturing companies in ASEAN countries reduced the number of layoffs in the first month of 2021. According to the report, the decline in the number of manufacturing workers in ASEAN countries in January was the lowest level since February 2020, and the actual number of layoffs was very small. Despite the decline in staffing levels, the backlog of manufacturing companies has fallen further, but the rate of decline has slowed to the lowest level in the last 19 months.
Manufacturing companies in ASEAN countries continued to reduce the number of input purchases in January, which was the same as in December 2020, which was actually not large. As a result, the pre-production inventory of manufacturing companies declined in January, but the decline was the lowest level in more than a year. Similarly, the inventory of finished products of manufacturing companies also fell in January, and the decline reached the lowest level after February 2020.
In terms of prices, the cost pressures on the manufacturing industries of ASEAN countries intensified in January. The input prices of the month set the largest increase since October 2018, and the actual increase was significant. For this reason, manufacturing companies have increased their ex-factory prices for the third consecutive month, the highest level since May 2019.
Looking ahead, manufacturing companies in ASEAN countries are still optimistic about output growth in the coming year. However, optimism has declined slightly from December 2020 and is at a historical low.
Economists at IHS Markit said that in January 2021, the health of the manufacturing industry in ASEAN countries improved for the second consecutive month. Overall, the January PMI data is good news for the manufacturing industry, indicating that the recovery has finally begun. However, the manufacturing industry in ASEAN countries is still unbalanced. The reason is that stricter blockade measures have suppressed the demand in some countries. However, if the current blockade measures can be successful in containing the epidemic, with the promotion of vaccines and the overall relaxation of related measures, the entire ASEAN manufacturing industry should be able to expand further.
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