Businesses have signalled that the Malaysian manufacturing sector saw demand conditions soften midway through the second quarter of 2022 as productive capacity was hindered by price pressures and supply shortages.
S&P Global said there was a further moderation in production levels that was the fifth in as many months, while new order growth slowed sharply from April 2022.
“The lack of productive capacity also extended into the labour market as the rate of job shedding quickened to the sharpest seen since August 2020,” it said.
S&P Global Market Intelligence chief business economist Chris Williamson said the lockdowns in mainland China in particular continued to aggravate the supply situation which, alongside difficulties sourcing workers, leading to a deteriorating factory production trend.
“Optimism has been buoyed by stronger export sales and signs of a possible peaking of both supply delays and input cost inflation.
“Supply chains lengthened to the least extent for almost a year in May, and input costs rose at the slowest rate since last September, both welcome indications that the supply and inflation crisis may be starting to ease,” he said.
S&P Global said manufacturers also reported that raw material shortages and rising prices had dampened client demand and production capacity.
