Indonesia Manufacturing Shrinks for 3rd Month

Indonesia’s S&P Global Manufacturing PMI dropped to 50.1 in March 2026 from 53.8 in the previous month, signaling near-stagnant conditions. Output fell after four months of growth, the sharpest decline since June 2025, as the Middle East conflict and global uncertainty weighed on activity. New orders softened for the first time in eight months, while export demand slipped after February’s rise. Backlogs contracted for the first time since October, prompting slight job cuts for the second time in three months. Purchasing activity also declined, the first drop since July 2025. Delivery delays worsened to the most severe since October 2021, extending a six-month trend amid material shortages and shipping disruptions. On inflation, cost pressures intensified, with input inflation hitting a two-year high, driving firms to raise selling prices at the fastest pace since June 2022. Looking ahead, sentiment ticked higher on hopes that demand will recover and tensions ease.

Indonesia’s S&P Global Manufacturing PMI rose to 53.8 in February 2026 from 52.6 in the previous month, marking a seventh straight month of expansion in factory activity and the fastest pace since March 2024. The improvement reflected stronger domestic demand, as new orders grew for a seventh month at the quickest rate since last November. Output also expanded at the fastest pace since April 2024, while foreign demand increased for the first time in six months, recording its strongest rise since May 2022. Firms lifted employment for the sixth time in seven months, helping keep backlogs broadly stable. Input buying rose at the sharpest rate in nearly two years. However, supply pressures persisted due to shipping delays and flooding, extending delivery times for a fifth month. Input costs remained elevated, though inflation eased to a six-month low, prompting only modest increases in selling prices. Finally, confidence softened from January and stayed below the long-run average.

Indonesia’s S&P Global Manufacturing PMI rose to 52.6 in January 2026 from 51.2 in the previous month, marking a sixth straight month of expansion in factory activity. Output grew for a third month and at the second-fastest pace in nearly a year, while new orders extended their six-month streak, signaling resilient demand. Meanwhile, firms boosted input purchases for a sixth month, as they sought to build both pre- and post-production inventories. At the same time, supplier delivery times lengthened to the greatest extent in more than four years, weighed down by stronger input demand and adverse weather conditions. Capacity pressures intensified as backlogs rose for a third month, yet employment slipped marginally after six months of gains. On the cost front, input price inflation stayed marked but steady, below the long-run average, while output prices rose modestly at the slowest pace in three months. Finally, business confidence strengthened further, reaching a ten-month high.