E&E to support manufacturing growth as PMI reaches six-month high
MBSB Research said stronger orders supported hiring and purchasing, but rising costs weighed on manufacturers’ sentiment.
Malaysia’s manufacturing PMI reached 51 on Oct 26, compared with 49.9 in September, its highest level in six months. S&P Global linked much of the improvement to increased demand for products related to artificial intelligence (AI).
Analysts expect electrical and electronics (E&E) to remain a driver of growth despite inflation and supply-chain risks. Philip Research said domestic export figures indicated that industries beyond AI-related products had also seen stronger exports, potentially supporting production. However, it expects weak near-term sentiment to constrain a recovery outside E&E.
MBSB Research said output and new orders had returned to growth, with orders expanding at one of the quickest rates in four-and-a-half years. The improvement encouraged manufacturers to increase purchasing, while employment grew for a third consecutive month.
Higher transport and raw-material expenses accelerated input-cost inflation, prompting manufacturers to increase selling prices, MBSB said. It partly attributed the pressure to the ongoing Middle East conflict. Sentiment fell to its lowest level in six months as cost concerns increased.
Elsewhere in Asean, Phillip Capital noted that Indonesia’s manufacturing PMI climbed to 54, the highest since March 2024. Thailand recorded 54.8, a year-to-date high, supported by a sharp rise in new orders.
