• IPI grows 1.0% yoy in September
• Growth in IPI led by manufacturing component, while the mining and electricity segments declined
• 3Q IPI grew 0.8%
• Growth in manufacturing sales accelerates
• Productivity surged 6.1% yoy in September
• 3Q20 global semiconductor sales increased 11.0%
• Recovery in global production continues in September
• Production will continue to rise but the situation remains fragile

IPI grows 1.0% yoy in September

Industrial production (IPI) rose by 1.0% yoy in September, after a 0.2 percent gain a month earlier. This was the third straight month of growth in industrial output, as the country emerged further from the COVID-19 shocks following the loosening of the movement control orders. Growth in IPI for September was driven by increase in the IPI’s manufacturing component, while the mining and electricity segments showed a decrease

On monthly basis, the IPI in September increased 0.5%. Based on month-on-month comparison, the growth in IPI for September was due to the increase in the index of manufacturing (2.1%). On the other hand, the mining and electricity segments showed declined of -4.1% mom and -3.7% mom respectively. In a seasonally adjusted terms, IPI in September recorded an increase of 1.0% due to the positive growth in manufacturing index (1.6%) and electricity index (2.2%). However, the mining index recorded a decline of 3.3%.

Given the latest data, this brings IPI for 3Q20 to a y-o-y growth of 0.8% due to a 3.1% growth in the manufacturing index, despite the mining and electricity indices recording a decline of 6.5% and 2.8% respectively.

Source: BIMB Securities Research - 10 Nov 2020