• IPI grew 1.5% yoy in February

• IPI growth driven by strong output in the manufacturing sector

• Production of the mining and electricity sector shrank in February

• Manufacturing sales increased 6.4% yoy; -3.6% mom in February

• Productivity increased 8.8% yoy in February

• Global semiconductor sales up 14.7% yoy in February

• Improvement seen in global industrial production for February

• Production to grow higher supported by robust external demand

IPI grew 1.5% yoy in February

Growth in industrial production was sustained in February. The IPI continued to expand, rising by 1.5% yoy, after a 1.2% yoy rise in January 2021. This was the third straight month of increase in industrial output, as the economy gradually recovered from recession, with strong output in both export and domestic-oriented industry in manufacturing sector. The growth in production was mainly driven by improving production of manufacturing sector. However, both mining and electricity output fell faster as compared to the previous month.

On monthly basis, the IPI in February fell by 6.4%. Based on month-on-month comparison, the contraction in IPI for February was due to the decline all sub-indices of manufacturing (-5.8%) mining (-8.9%), and electricity (-5.8%). In a seasonally adjusted terms, IPI in February 2021 recorded an increase of 6.3%. The positive growth was due to the manufacturing index (+6.7%) and electricity index (4.2%). and mining index (+4.1%).

The IPI in the period January to February 2021 recorded a rise of 1.3% as compared to the same period of the previous year. This positive growth was due to the increase in manufacturing index (+4.0%). However, mining and electricity index both fell (- 5.2%).

Source: BIMB Securities Research - 12 Apr 2021