Malaysia's manufacturing sector showed signs of stabilisation in September this year, with operating conditions remaining broadly unchanged, the latest S&P Global Malaysia Manufacturing PMI showed.
The headline PMI registered 49.8, sitting just below the 50.0 mark that separates growth from contraction.
"... the latest data suggested that GDP (gross domestic product) growth in the third quarter ticked up slightly from that seen in the previous quarter, as well as pointing to sustained year-on-year improvements in official manufacturing production data," S&P Global said in a statement on Wednesday.
A key development during the month under review was a fractional scaling back of production levels, ending a period of expansion, read the statement.
Some firms in the survey indicated that completed goods were going unsold, contributing to the subdued output, with the seasonally adjusted Output Index falling just below the neutral 50.0 mark.
"As a result, stocks of finished goods were unchanged, ending a 38-month sequence of falling postproduction inventory levels," it added. There was a marginal rise in new orders during September, for the second consecutive month.
"Where new orders rose, firms mentioned new project launches and higher client confidence, notably in the domestic economy.
"The expansion in overall new business was recorded in spite of a first moderation of new export orders in three months, amid reports from panellists of muted demand in key markets including the US, Europe and the Asia-Pacific region."
This steady demand placed some strain on operating capacity, halting a 13-month sequence of declining backlogs of work.
On a less positive note, staffing levels continued to fall, marking the third consecutive month of job shedding.
The rate of input cost inflation slowed to its most modest pace since April 2022, easing the burden on firms.
This was largely linked to softer pressures from raw-material prices.
Meanwhile, Malaysian goods producers noted a softer increase in operating expenses during September.
"The latest uptick in input prices was only mild, and the softest recorded in five months. While some companies mentioned the impact of higher taxation, this was partially offset by lower raw material prices."
Manufacturers also commented on a deterioration in vendor performance for the third time in four months in September.
"The lengthening of lead times was only marginal, but attributed to port congestion and shipping delays".
With rising new orders and easing cost inflation, business confidence regarding the year-ahead outlook strengthened notably.
Overall business sentiment subsequently climbed to its highest level in seven months.
The survey also pointed to the potential for sustained year-on-year improvements in official manufacturing production data.
Source: The Edge Malaysia
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<p>Time: November 2025<br /> By: WTO and International Trade Group, Legal Department – VCCI</p>
