KUALA LUMPUR: Manufacturers in Malaysia reduced their selling prices at the strongest rate in ten years to counter subdued demand conditions, according to S&P Global Malaysia.
In its latest Manufacturing PMI, the research house said the price reductions, the first since June 2023, aimed to stimulate sales as new orders remained weak both domestically and internationally.
“In response to current demand conditions, manufacturing firms opted to lower their selling prices as part of attempts to stimulate sales. The reduction was the first since June 2023 and — while only modest — was the strongest seen for a decade,” said Usamah Bhatti, Economist at S&P Global Market Intelligence.
Despite the price cuts, production levels continued to decline, marking the eighth consecutive month of output reductions.
The S&P Global Malaysia Manufacturing PMI rose slightly from 48.6 in December to 48.7 in January, signalling a continued slowdown in the sector.
Employment levels also dipped for the fourth straight month as manufacturers adjusted to lower production needs.
Purchasing activity saw a sharper decline in January, with firms cutting back on stock holdings amid weaker business conditions.
Input cost inflation increased slightly, though it remained lower than the 2024 average, with supply chain disruptions adding pressure.
Despite ongoing challenges, manufacturers expressed cautious optimism for 2025, hoping for an eventual recovery in demand.
The report comes ahead of a sudden trade war triggered by US President Donald Trump who slapped tariffs on Canada, China, and Mexico, prompting retaliatory measures from the three countries.-MALAY MAIL
