JAKARTA - In the first quarter of 2021, the performance of the manufacturing sector is expected to increase and is in an expansionary phase. This is reflected in the Bank Indonesia Prompt Manufacturing Index (PMI-BI) of 50.01% [1], up from 47.29% in the fourth quarter of 2020, in line with the increase in activity in the Manufacturing sector as a result of the Business World Activity Survey (SKDU).

The increase occurred in almost all components that make up PMI-BI, especially the volume of total orders, the volume of finished goods inventories, and the volume of production which is in the expansion phase. In terms of sub-sectors, the majority of respondents noted performance improvements in the first quarter of 2021, especially in the Food, Beverage and Tobacco sub-sector, the Fertilizer, Chemical and Rubber Goods subsector, and the Textile, Leather Goods and Footwear subsector, which are already in an expansion phase.

In Q2 / 2021, the manufacturing sector is forecasted to improve and is in an expansionary phase. The PMI-BI in Q2 / 2021 is predicted at 55.25%, an increase from the previous quarter. The increase in PMI-BI was driven by all of its constituent components, especially production volume, total order volume, and volume of finished goods inventories which were in the expansion phase.

In addition, all sub-sectors are predicted to be in an expansionary phase, particularly the Paper and Printed Materials sub-sector, the Food, Beverage and Tobacco sub-sector, and the Fertilizer, Chemical and Rubber Goods subsector. Respondents predicted this increase will be driven by increased demand during Ramadan and Eid al-Fitr holidays. (LM)