Indonesia’s manufacturing sector strengthened in November 2025, with the Purchasing Managers’ Index (PMI) rising to 53.3, its highest level since February 2025. According to S&P Global Ratings, the improvement from October’s 51.2 was driven by renewed growth in output and the fastest increase in new orders since August 2023. Economist Usamah Bhatti noted that domestic demand played a major role in boosting activity toward the end of the year, even as export orders experienced a steeper decline. Companies responded to rising demand by increasing production for the first time in three months, alongside higher purchasing levels and expanded hiring. This surge created pressure on capacity, reflected in the sharpest rise in backlogs since September 2021.

Companies also accelerated inventory accumulation, marking the strongest stock buildup in eight months, although supply constraints emerged due to longer input delivery times influenced by delays and adverse weather. Toward year-end, manufacturers experienced heightened price pressures, with cost inflation reaching a nine-month high due to rising raw material prices and unfavorable exchange rate movements. Firms passed on some of these costs through higher factory gate prices, now at their peak in more than 18 months. Despite these challenges, the overall expansion signals strong momentum in Indonesia’s manufacturing sector.

Source: https://en.tempo.co/amp/2069969/indonesia-manufacturing-pmi-hits-highest-record-since-february