Indonesia, Vietnam Aug factory activity rises, Malaysia falls again-PMI

Sept 1 (Reuters) - Factory activity increased in Indonesia

and Vietnam in August, while that in Malaysia contracted more

than in the previous month, according to IHS Markit purchasing

managers' indexes released on Thursday.

In Indonesia, Southeast Asia's largest economy, the PMI

index moved above the 50.0 level that demarcates expansion and

contraction.

Vietnam had a ninth straight month of expansion, and by a

slightly faster pace, and Malaysia suffered its 15th

consecutive month of contraction, the indexes shows

INDONESIA:

Data from the IHS Markit's Nikkei Indonesia Purchasing Managers'

Index for August. Readings above 50.0 signal expansion in

manufacturing activity, rather than contraction.

DATA

AUGUST JULY JUNE

50.4 48.4 51.9

CONTEXT

- The seasonally-adjusted index for August edged back above

50.0 as new orders, exports and output all expanded.

- For new export orders, August's expansion ended a 22-month

sequence of contraction.

- Order book volumes, which fell in July, rose in August,

partly because the offering of cheaper prices increased domestic

and international demand.

- Stocks of raw materials and semi-finished goods increased

in August. Pre-production inventories rose at a moderate pace

that was the quickest in more than two years.

- But manufacturing employment declined for a second

straight month, and at a fastest pace this year.

Commenting on the Indonesia survey, Pollyanna De Lima,

economist at IHS Markit, said:

"The return to growth of Indonesia's manufacturing sector in

August is a positive sign, especially as July's decline raised

concerns regarding the start of a new downturn. Survey data

indicate that firms are undoubtedly cautious about the

short-term outlook for new work and production, as highlighted

by another reduction in payroll numbers."

"August's increases in output and new orders lay a platform

that companies will hope to build on in coming months should

improvements in client demand strengthen. IHS Markit expects GDP

growth in Indonesia to accelerate from the post-recession low of

4.8 percent in 2015 to 5.1 percent in 2016, with lower interest

rates anticipated to support private consumption."

MALAYSIA:

Data from the Markit Malaysia Purchasing Managers' Index for

August.

Readings above 50.0 signal an improvement in business

conditions while readings below indicate deterioration.

DATA

AUG JULY JUNE

47.4 48.1 47.1

CONTEXT

- Manufacturing activity in August contracted at a quicker

rate than in July, following sharper declines in output, new

orders and employment

- Production fell on a drop in total new orders, partly from

slowing international demand.

- Employment fell to its weakest since April 2013 as

operating conditions worsened.

- Input buying contracted for a 15th straight month, but

registered its strongest levels during that period.

Commenting on the Malaysia PMI survey, Amy Brownbill,

economist at Markit, said:

"Latest survey data for the Malaysia manufacturing sector

signalled a sharper deterioration in operating conditions. This

was underpinned by quicker declines in output, new orders and

employment with the rate of job shedding the fastest in over

three years.

"Meanwhile, cost inflationary pressures intensified, with

input prices increasing at the joint-second fastest rate in the

series history. This was linked by the survey panel to higher

raw material costs stemming from unfavourable rates and the rise

in the sales tax."

VIETNAM:

Data from the Nikkei Vietnam Purchasing Managers' Index for

August.

Readings above 50.0 signal an increase in business activity

while readings below indicate deterioration.

DATA

2016

AUG JULY JUNE MAY APRIL MARCH FEB

52.2 51.9 52.6 52.7 52.3 50.7 50.3

CONTEXT

- Output and new orders increased at weaker rates

- Employment posted the strongest rise in 32 months

- Purchasing activity has biggest jump since May 2015

Vietnam's August PMI edged up to 52.2 from 51.9 in the

previous month, showing a modest improvement in operating

conditions, thanks mainly to faster rises in employment and

purchasing activity.

Employment had the strongest jump since December 2013 as a

fifth consecutive rise, with staffing levels increasing in the

investment and consumer goods sectors.

Manufacturers raised their purchasing activity due to higher

new orders this month, supporting an increase in stocks of

purchases that was biggest in 15 months.

Output and new orders both expanded, but at a slower pace

compared with recent months, while input costs extended their

climb but firms reduced their charges, apparently in a bid to

improve sales.

(To read more PMI reports from around the world, click on

)

Markit is a registered trade mark of IHS Markit Limited.

(Reporting by Nilufar Rizki in JAKARTA, Emily Chow in KUALA

LUMPUR and My Pham in HANOI; Editing by Richard Borsuk)