• Malaysia manufacturing PMI falls further in October

• Global manufacturing at 78-month high in October

• US ISM manufacturing index pulls back off thirteen-year high in October

• Eurozone manufacturing PMI rises to 80-month high in October

• UK manufacturing PMI rises in October

• Divergence in China manufacturing survey continues.

• ASEAN manufacturing improves further in October

Malaysia manufacturing PMI falls further in October

The Nikkei Malaysia manufacturing PMI fell to 48.6 in October from 49.9 in September. The overall downturn was mainly driven by a reduction in new work. The rate of contraction was solid and the fastest since July. Meanwhile, new export orders fell for the second consecutive month. The rate of contraction quickened to the greatest since December 2016. The manufacturing sector recorded a rise in output during October but the rate of growth was only fractional. In response to lower levels of new work, firms decreased their payroll numbers for the first time in four months. The pace of job shedding was the sharpest since August 2016. Reflecting weak underlying demand conditions, manufacturers reduced their input buying again in October. At the same time, companies were discouraged from adding to their pre-production inventories at a solid pace. Firms continued to face higher input costs. The rate of inflation remained sharp overall, but eased from the prior month. There were reports that ringgit weakness relative to the USD contributed to a general rise in market prices for raw materials. Firms raised their average selling costs, albeit at a marginal pace. Manufacturers retained positive expectations for output in October, although confidence was the weakest since May.

Source: BIMB Securities Research - 3 Nov 2017