• Falls in new orders drags Malaysia’s manufacturing PMI into negative territory
• Global manufacturing growth slowdown continues in October
• US ISM manufacturing growth eases in October
• Eurozone manufacturing growth at 26-month low
• UK manufacturing PMI drops to 27-month low
• China manufacturing PMI worsens in October as trade war bites
• Japan's manufacturing sector grows at fastest rate since June

Falls in new orders drags Malaysia’s manufacturing PMI into negative territory

Malaysia’s Manufacturing Purchasing Managers Index (PMI) dipped below the 50.0 no-change mark in October to 49.2 from 51.5 in September for the first time since July, signalling worse business conditions than in the previous month. Latest survey data pointed to a deterioration in the health of Malaysia’s goods-producing economy at the start of the fourth quarter. Although output was only slightly lower than in September, new orders fell markedly and at the fastest rate in five months, while output dropped for the first time since June. At the same time, another month of sharp input price inflation influenced a reduction in the volume of purchasing activity. Detrimental exchange rate movements, rising raw material prices and the Sales & Services Tax (SST) were all cited as sources of cost pressures in October. In addition, there was a notable slowing of employment growth amid reports of costcutting initiatives. Meantime, new export orders increased the most in nine months, with neighbouring countries across Southeast Asia supporting international demand for Malaysian goods Looking ahead, businesses expect output levels to increase over the coming year.

Source: BIMB Securities Research - 5 Nov 2018