ASEAN manufacturing growth accelerates in April: IHS Markit

KUALA LUMPUR, May 7 (Xinhua) -- Manufacturing conditions across the Association of Southeast Asian Nations (ASEAN) improved at a quicker pace at the start of the second quarter, according to the headline Nikkei ASEAN Manufacturing Purchasing Managers' Index (PMI) compiled by IHS Markit.

IHS Markit said Monday that the PMI in ASEAN rose to 51 in April from 50.1 in March.

"Faster rises in new orders and output and a renewed increase in employment all boosted the headline index. However, inventories of inputs continued to decline, based on the survey," it said.

Five of the seven countries covered by the survey recorded a PMI reading above the neutral 50 level, up from four in March.

The five countries are Myanmar, Vietnam, the Philippines, Indonesia and Singapore. Thailand and Malaysia, however, remained in contractions.

While April survey data was encouraging, IHS Markit's principal economist Bernard Aw noted that demand needs to grow at a faster rate before stronger growth can take root.

"First, sales are not increasing fast enough to test the capacity of manufacturers across the region. Backlogs of work continued to fall which weighed on hiring, suggesting that future job creation may be limited," he explained.

"Second, firms remained cautious about inventory management despite the pick-up in orders, as inventories of both inputs and finished goods continued to be depleted."

"Third, while business confidence remained positive, optimism was among the lowest in the survey history," he added. Enditem