Indonesia Manufacturing Improves Solidly

Indonesia’s S&P Global Manufacturing PMI climbed to 52.4 in September 2026 from 49.8 in August, marking the highest print since February and signalling a renewed expansion in factory activity. Output and new orders grew at their fastest pace since February, while foreign demand rose for a second month and at the strongest rate since May 2022. Further, hiring rose at its fastest pace since February 2025, while backlogs rose at their steepest rate in five years. Firms increased input purchases at the fastest pace since February, while input inventories rose to their highest level since March 2024. Supply chains remained broadly stable, with lead times lengthening slightly. On prices, input cost inflation slowed to a six-month low, but it remained above the long-run average amid higher raw-material and supplier costs, currency effects, shortages, and fuel-policy impacts. Output prices eased to a six-month low. Finally, confidence remained strongly positive despite easing slightly.

Indonesia's S&P Global Manufacturing PMI slipped to 49.8 in August 2026 from July's five-month high of 50.2, signalling a mild deterioration in factory activity. Output and employment fell in five of the past six surveys, with the latest decline in output tied to stronger competition and higher goods prices. Demand conditions were broadly neutral, while backlogs rose for a second month, though at a slower pace. Purchasing activity stabilised after five months of contraction. Supplier delivery times lengthened slightly, with delays only marginally worse than July. On the cost side, price pressures continued to ease, yet input costs and output charges remained historically elevated, reflecting higher raw material and supplier prices often passed on to customers. Finally, business confidence strengthened to a seven-month high, supported by expectations of firmer demand and stable market conditions that could underpin higher production over the next year.

Indonesia's S&P Global Manufacturing PMI rose to 50.2 in July 2026 from 46.9 in June, marking its highest reading since February. Output rose after four months of decline, though growth was marginal, while new orders steadied following June’s sharp drop. Meanwhile, export sales remained weak, falling for a fifth month. Rising workloads drove the strongest backlog buildup since November 2025, prompting firms to add staff for the first time in five months, albeit modestly. Purchasing activity slipped again, though only fractionally. Delivery times lengthened for a tenth month due to shipping delays, but the deterioration was the mildest in the current sequence as material availability improved. Input cost inflation eased to a four-month low yet stayed elevated on pricier raw materials, leading to another sharp rise in selling prices. Finally, sentiment hit its highest since January, supported by expectations of firmer sales, improving customer sentiment, and softer cost pressures.