Indonesian Manufacturing PMI Maintains Expansionary Trend

Positive Outlook for Early 2026

The positive trend in Indonesia's Manufacturing Purchasing Managers' Index (PMI) is expected to continue through early 2026, according to Myrdal Gunarto, Global Market Economist at Maybank Indonesia. The November 2025 PMI report from S&P Global showed a reading of 53.3, indicating robust expansion in manufacturing activity. This growth is supported by both domestic and international demand, with particular strength in sectors such as food and beverages, steel, pharmaceuticals, and downstream industries.

Drivers of Manufacturing Growth

Several factors are contributing to the sustained expansion in Indonesia's manufacturing sector. The strong industrial performance in recent months has been bolstered by end-of-year demand surge and government policy stimulus. Myrdal noted that the positive developments in the manufacturing sector have been consistent, with year-end demand typically showing an uptick. The combination of these factors has created a favorable environment for continued growth in the manufacturing sector.

Sectoral Performance

The November PMI data revealed that multiple sub-sectors within the manufacturing industry are performing well. Food and beverage production has shown resilience, while the steel industry has benefited from both domestic infrastructure projects and international demand. The pharmaceutical sector continues to demonstrate growth, supported by ongoing health needs and industrial capacity expansion. Additionally, industries related to downstream processing have maintained their positive trajectory, contributing to the overall manufacturing growth.

Economic Implications

The sustained expansion in Indonesia's manufacturing sector has positive implications for the broader economy. Continued growth in manufacturing activity is likely to support overall economic stability and potentially contribute to job creation in related industries. The positive outlook for early 2026 suggests that the current economic momentum in the manufacturing sector may be maintained, barring any unforeseen global economic shocks.