Indonesia’s manufacturing sector is poised for renewed growth, with the central bank forecasting stronger momentum in the current quarter following a period of expansion in the second quarter.
The Bank Indonesia (BI) assessment marks a shift in tone after recent data pointed to a slowdown in industrial activity.
The optimistic outlook comes as investors digest mixed signals from the Indonesian economy.
While the second quarter saw the manufacturing sector remain in expansion territory, the Purchasing Managers’ Index (PMI) for June fell to 46.9, indicating a contraction in activity compared to the previous month.
A reading below the 50.0 threshold signals a decline in output, new orders, and employment within the sector.
Market participants are weighing the central bank’s forward-looking commentary against the recent softness in high-frequency data.