Strengthening demand and higher production needs boosted business confidence, which surged to its highest since March after hitting a five-year low earlier.
The rise in the headline index was supported by a solid and stronger increase in production, as well as a renewed, albeit a modest uptick in new orders. Output has now risen for a second consecutive month, with the rate of growth in August the fastest since mid-2024. Additionally, the fresh uptick in new orders effectively ended the previous four-month sequence of decrease, S&P Global said in a press release.
Job shedding was recorded for the fifth consecutive month in August, indicating that firms remained hesitant to take on staff. However, the respective seasonally adjusted index rose further since June, reaching a five-month high, indicating only a slight decline in employment—the weakest in five months.
On the price front, while input prices rose at a weaker pace than seen in July, charges were raised modestly but at the strongest pace in eight months.
After hitting a five-year low in July, confidence rose in August across ASEAN manufacturers. Firms on balance were more positive about output growth in the year ahead. While below the long-run average, the respective index posted a five-month high, added the release.
“The August PMI data signalled building momentum across the ASEAN manufacturing sector following the recovery experienced in July. Demand conditions strengthened, as reflected by a fresh increase in new orders. Additionally, output growth accelerated,” said Maryam Baluch, economist at S&P Global Market Intelligence.
“The enhanced performance of the sector led to an increase in business sentiment regarding production prospects over the next 12 months. Confidence levels reached a five-month high in August, rebounding from a five-year low recorded in July, suggesting that the region could sustain and even build upon the growth observed during the latest survey period,” added Baluch.
ALCHEMPro News Desk (SG)
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