Rapid spread of Delta variant weighs on Asia's factories as PMIs drop

Manufacturing managers across Southeast Asia reported a heavy blow in August from one of the world’s worst Covid-19 outbreaks, while producers in North Asia continued to enjoy robust output.

Manufacturing PMIs for Indonesia, Vietnam, Thailand, Philippines and Malaysia all remained deep in negative territory in August, reflecting the disruption from lockdowns that forced factories to halt or slow production.

Vietnam’s IHS Markit PMI fell to 40.2 from 45.1 in July, its third consecutive month of contraction and the lowest reading since April 2020. Thailand’s PMI fell to 48.3 from 48.7 — its seventh contraction in the past eight months— while the Philippines’ fell to 46.4 from 50.4, its lowest reading since May 2020. Malaysia’s reading ticked up to 43.4 from 40.1 in July, and Indonesia’s rose to 43.7 from 40.1, though both remained well below the 50 point level that separates contraction from expansion.