KUALA LUMPUR (Jan 2): The Asean manufacturing sector saw a further deterioration in operating conditions at the end of 2019 albeit at its softest pace since a downturn that began in June, according to IHS Markit Asean Manufacturing Purchasing Managers' Index (PMI).

The headline PMI rose from 49.2 in November 2019 to 49.8 in December 2019 — signalling a seventh consecutive deterioration in the health of the Asean manufacturing sector — on a further modest improvement in suppliers' delivery times and falls in both employment and input inventories.

"That said, the decline was the softest in the current sequence of contraction, with Asean goods-producers signalling only a fractional deterioration in the health of the sector. Production increased for the first time since June, albeit barely, whilst incoming new business rose for the first time in five months, to highlight some improvement in demand conditions.

"Nonetheless, overall 2019 performance has been subdued, with the average PMI reading (49.6) down from that seen in 2018 (50.6). In order for the Asean sector to begin next year on a stronger footing, a further improvement in total new business will be needed, as muted demand conditions remain a key concern," said IHS Markit economist Lewis Cooper in a press release today.

Firms continued to cut workforce numbers during the latest survey period, as has been the case in each month since June, while outstanding business also contracted during December.

"The rate of backlog depletion was unchanged from November and moderate overall.

"On the price front, cost burdens rose further during December, as has been the case in each month since the series began in early-2011. The rate of cost inflation quickened to the fastest since September, but remained marginal. Average prices charged by Asean manufacturers also increased, following two months of no-change. The rate of selling price inflation was the only fractional, however," IHS Markit added.