The S&P Global Indonesia Manufacturing PMI plunged to 46.9 in June from 50.0 in May, which is also the threshold that separates expansion from contraction, signaling a fresh decline in the health of the goods-producing sector.
Boxes of battery cells are seen stored for shipment on Aug. 28, 2024, at a battery manufacturing plant at PT HLI Green Power in Karawang, West Java. (AFP/Yasuyoshi Chiba)
Collapsing demand and the fastest rise in factory-gate prices in nearly 13 years have sent Indonesia’s manufacturing sector into its sharpest contraction in a year at the close of the second quarter, according to the latest purchasing managers’ index (PMI) data.The S&P Global Indonesia Manufacturing PMI plunged to 46.9 in June from 50.0 in May, which is also the threshold that separates expansion from contraction, signaling a fresh decline in the health of the goods-producing sector.
A renewed decline in new orders drove the slump, with total demand falling for the first time in three months and at the fastest pace in a year.
Panel members attributed the weakness to eroding consumer purchasing power, as persistent price pressures choked off demand. The decline in new export orders was equally grim, recording the steepest drop since August 2021 as higher prices made Indonesian goods less competitive in international markets.
