KUALA LUMPUR: Malaysia’s manufacturing purchasing managers’ index (PMI) slipped to 47.9 in November from 48.7 in October, showing a more marked slowdown in business conditions, S&P Global said.
S&P Global Market Intelligence economist Laura Denman said there was a solid slowdown in production levels amid the fastest scaling back in order book volumes since August 2021.
“The aforementioned fragility in demand became a running theme throughout the survey data and was reportedly the primary factor driving moderations in input buying, stocks and business confidence which, though still positive, slipped to a five-month low,“ she said in a statement on Dec 1.
Nevertheless, she said, there were some “more encouraging” price costs aspects in the November data.
“Further signs of easing supply pressures were displayed in November, as indicated by the latest lengthening of suppliers’ delivery times being the softest in three years and only marginal overall.
“Meanwhile, both input cost and selling price inflation ticked up very slightly from October but remained well below the rates seen earlier in the year,“ she noted.
The latest PMI reading is representative of about 5% year-on-year growth in Malaysian gross domestic product (GDP), signalling a slowdown in growth from the situation in the third quarter of 2022.
S&P Global said the moderation in the headline figure was the sharpest in 15 months and was driven by muted underlying demand conditions.
Malaysian manufacturing firms registered similar trends for international sales volumes.
“New export orders were scaled back for the fifth time in as many months and at a solid rate,” it said.
Meanwhile, output moderated for the fourth month running midway through the final quarter.
S&P Global said the muted demand conditions reportedly led firms to scale back input buying in November and at the fastest pace since September 2021.
The slowdown in sales allowed firms to focus on working through outstanding business in November, thereby stretching the current sequence of backlog depletion to six months, the market intelligence agency said.
“Malaysian manufacturing companies, however, remained hopeful that demand conditions would normalise over the coming year, as signalled by a 17th consecutive month of optimism regarding the year-ahead outlook for production,” it added. – Bernama