• Malaysia’s manufacturing PMI plunges to all-time low

• Global manufacturing PMI at lowest level since September 2016

• US manufacturing growth hit new lows

• Growth in Eurozone manufacturing activities continue to falter

• Modest improvement in UK manufacturing growth

• China manufacturing sector slips into contraction

• ASEAN manufacturing PMI meanders around break-even in December

Malaysia’s manufacturing PMI plunges to all-time low

Malaysia’s manufacturing economy took a sharp dive in December, with the key manufacturing gauge tumbling to the lowest level in years. The manufacturing PMI plunged to 46.8 from November's 48.2, to reach the lowest level since the survey started in July 2012. The latest reading was consistent with a marked deterioration in the health of the manufacturing economy, and meant the sector contracted in each month of 4Q. Pulling the headline Index further into negative territory was the one of the sharpest contraction in demand in the survey history. Panellists indicated that the fall in sales reflected a general slowdown across the marketplace. Malaysian manufacturers also received unfavourable intakes of new work from overseas in December however, the fall in foreign demand was only mild. Concerns over demand led companies to use existing stocks to clear backlogs and cut back input purchasing. As a result, supply chain pressures alleviated, while purchasing costs increased to a weaker extent. The deterioration in manufacturing sector health was also fuelled by a stagnation in employment, ending six straight months of job creation. The loss of growth momentum was attributed to resignations. Nonetheless, confidence strengthened amid upbeat sales forecasts for 2019.

Source: BIMB Securities Research - 3 Jan 2019