The latest IHS Markit Myanmar Manufacturing PMI plunged to 30.6 in October 2020 from 35.9 a month earlier. This was the second-lowest reading on record as the economic fallout from the COVID-19 crisis persisted, with the government putting many regions in tightening restrictions.

IHS Markit reports that output, new orders and purchases all contracted at record rates. Also, job shedding continued after workers returned to their hometowns. In line with record falls in new work, purchasing operations were scaled back. The volume of inputs fell at the fastest rate on record, while stocks of purchases contracted at the joint-second fastest rate in the survey history. Vendor performance weakened for the second straight month. On the price front, inflationary pressures arose with cost burdens increasing modestly.

The Purchasing Managers’ Index (PMI) is a survey-based economic indicator designed to provide a timely insight into changing business conditions in the goods-producing sector. It includes individual measures: new orders are given the highest weight (30%), followed by output (25%) and employment (20%), then followed by suppliers’ delivery times (inverted, with a weight of 15%) and finally inventories of goods purchases (10%).

A PMI above 50 represents an expansion when compared with the previous month, while a PMI under 50 represents a contraction, and a reading at 50 indicates no change.