Manufacturing production in the ASEAN region showed a marginal improvement in January 2025, according to the S&P Global ASEAN Manufacturing Purchasing Managers’ Index (PMI). The index stood at 50.4, slightly down from 50.7 in December, marking the slowest growth in nearly a year. Despite the improvement in production, both output and new orders saw restrained growth, resulting in a subdued increase in purchasing activity.

Staffing levels fell at the quickest rate in nearly five years, and average selling prices declined at the fastest pace since July 2023. However, after two months of job losses, the employment landscape stabilized. There was also a noticeable easing of inflationary pressures, with operating costs and charges rising at their slowest rates in months.

Despite the slowdown, ASEAN manufacturers recorded an increase in backlogs, reflecting rising pressures on capacity. However, vendor performance continued to decline, albeit at a slower pace. Business confidence remained broadly unchanged, with firms expressing cautious optimism about output in the next 12 months. This indicates a slight, yet persistent, trend of growth amid ongoing challenges.