Manufacturing expanded in India in January but
growth was weak as were expansions in South Korea and Indonesia, according to
data released today.
Indian manufacturers signalled a
further improvement in operating conditions during January. The headline HSBC
India Purchasing Managers’ Index (PMI) posted 51.4, up from 50.7 in December.
The latest reading was the highest since March 2013, but pointed to a marginal
pace of expansion that was well below the series average (55.1).
January saw new orders expand at the quickest rate in ten
months, with survey participants reporting stronger demand from both domestic
and overseas clients. Concurrently, new business from abroad grew at a solid
pace that was the fastest since June last year. Subsequently, Indian
manufacturers raised their production levels for the third successive month. The
rate of output growth was solid and the strongest since February 2013.
Sector data indicated that consumer goods continued to
outperform the remaining two monitored categories, while operating conditions
deteriorated at capital goods producers. Growth rates for output and new orders
in the consumer goods sub-category surpassed those seen at intermediate goods
The HSBC South Korea
a reading of 50.9 in January, a fractional improvement on the 50.8 seen in
December. January marked the fourth consecutive month in which the PMI posted
above the 50.0 no-change mark, separating expansion from contraction, signalling
a further improvement in operating conditions at South Korean manufacturers. In
addition, this was the sixth month in which the PMI had steadily risen from
July’s ten-month low.
Output at South Korean manufacturers grew at a modest rate
in January. Whilst the pace of production growth eased marginally from
December’s seven-month high, the modest increase was nevertheless an improvement
on the weak growth seen in October and November. A number of panellists
attributed the latest increase in output to an improvement in domestic economic
New orders rose for a fourth consecutive month in January.
Although the pace of expansion remained modest, it was nevertheless the sharpest
in nine months.
New export orders also rose for the fourth month running,
and at a sharper pace than seen in December. Some respondents attributed the
latest increase to higher levels of new orders from Europe, North America and
The Indonesian manufacturing sector
remained in expansion territory at the start of 2014. Although output levels
fell, incoming new business grew at the joint-fastest pace in the history of the
series and new export orders increased for the first time since May 2013.
Adjusted for seasonal influences, the
HSBC Indonesia PMI
registered 51.0 in January, up from December’s 50.9 and above
the series average. The latest reading pointed to a slight improvement of
manufacturing operating conditions across Indonesia. Boosting the PMI was a
solid rise in incoming new work.
New orders placed at Indonesian manufacturers increased
for the fourth successive month in January, with companies commenting on
stronger demand. The pace at which order book volumes expanded was solid and the
joint-fastest in the series history (on par with November 2012). New business
from abroad also rose, amid reports of new contract wins from clients in Asia,
Europe and North America. Although marginal, the latest increase in export
orders ended a seven-month sequence of contraction.
Notwithstanding the solid growth of new orders, output
fell in January. That said, the rate of decline was only slight. Among other
factors, panellists indicated that lower production levels reflected raw
material shortages. Indeed supplier delivery times lengthened further in
January. Moreover, vendor performance deteriorated to the greatest extent since
last August. Firms largely linked longer lead times to recent heavy rain and
January data indicated that both input costs and output
prices rose at rates above their respective series averages. Purchase cost
inflation hit a three-month high, with survey participants reporting
unfavourable exchange rates. Firms correspondingly raised their tariffs at the
strongest rate since October 2013.
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