Indonesia's Manufacturing PMI Dips Nearly 2 Points in June 2021

Indonesia's manufacturing Purchasing Managers' Index (PMI) stood at 53.5 in June 2021. This figure represents a decrease of almost two points from the previous month's PMI of 55.3, marking the lowest level in the last three months.

According to IHS Markit, this decline is attributed to a slowdown in the expansion of Indonesia's manufacturing sector due to the surge in new Covid-19 cases domestically. Output and new order levels decreased, as did business optimism.

The worsening pandemic also disrupted the supply of raw materials and increased their costs. Consequently, selling prices to clients and consumers also increased.

Indonesia's manufacturing PMI had plummeted to 27-28 points in April-May 2020. This figure then began to climb, reaching the 30-40 point range in the second half of that year.

Furthermore, the PMI has shown improvement over the past eight months, remaining above 50 points. In fact, Indonesia's manufacturing PMI recorded its highest levels since the survey began twice consecutively: 54.6 in April 2021 and 55.3 in May 2021.