Manufacturing IPI hits 16.9% in October

It surpassed the Bloomberg consensus estimate of 14.5%.

The manufacturing industrial production index (IPI) for October printed 16.9% year-on-year (YoY), surpassing the Bloomberg consensus estimate of 14.5%.

Excluding biomedical manufacturing, manufacturing output printed 9.7% YoY, lower than the 11% recorded in September.

IPI across multiple manufacturing segments also increased for the month of October.

Manufacturing output for the month was highest in the biomedical segment, which rose by 56.1% YoY due to significant growth from the pharmaceuticals segment due to a low base from the year prior.

Transport engineering also expanded by 35.3% YoY, which is an increase of 13.8% YoY from last month.

Other segments which saw increases were the chemicals cluster by 15.3% YoY; precision engineering by 9.1% YoY; general manufacturing by 0.8% YoY; and electronic by 6.5% YoY.

RHB said they expect manufacturing segments, particularly, transport engineering, general manufacturing, biomedical, and chemicals to have “greater output in 4Q21 on the back of stronger demand for their respective outputs.”

Overall, the analyst also expects the manufacturing IPI to remain steady towards the last stretch of the year “given that external demand from major trading partners continues.”

PMI readings for overall manufacturing for October remained at 50.8 for the second month.