The seasonally adjusted S&P Global Malaysia Manufacturing Purchasing Managers’ Index (PMI) remained at 50.1 in December 2025, unchanged from November and signalling a slight expansion in operating conditions at the end of the year. The reading points to stabilisation in output after months of softer growth and suggests further year-on-year expansions in gross domestic product and manufacturing production.
Malaysia Manufacturing PMI shows stabilisation in output and stronger hiring
S&P Global said the December reading marked a further fractional strengthening of the manufacturing sector, with the most notable development being a solid rise in workforce numbers. Employment increased for a second consecutive month and the pace of hiring was the third-fastest since data collection began in July 2012, the most pronounced rise in more than seven years.
Maryam Baluch, an economist at S&P Global Market Intelligence, noted that firms took on additional staff ahead of new projects and to replace leavers. She added that output recorded a softer moderation in the closing month of 2025 and was close to stabilising in December, a reassuring sign after previous volatility.
While the overall PMI stayed in positive territory, the survey identified some softer demand dynamics. New orders moderated in December following a modest expansion in November, and new export orders recorded a fourth consecutive monthly easing. S&P Global described the pace of moderation as slight but marginally stronger than in the previous survey period.
Reflecting the slowdown in new factory orders, purchasing activity among goods producers stagnated in December. The respective seasonally adjusted index for input buying aligned with the neutral threshold of 50.0, marking the first month since last June that firms did not increase their input purchases.
Price pressures remained muted. The survey reported mild inflationary trends, in part because raw material purchasing did not grow, and some firms offered discounts to clients to stimulate sales. Those measures helped contain cost pressures while supporting demand-sensitive enterprises.
Analysts say the combination of steady PMI readings, strong employment growth and subdued inflationary pressure bodes well for Malaysia’s near-term economic performance. Historically, S&P Global’s PMI readings have correlated with official data, and the latest figures are consistent with further solid year-on-year expansions in GDP and manufacturing output at the end of 2025.
Looking ahead, the industry will be watching new order flows and export demand for signs of sustained recovery. If employment gains persist and orders recover, the sector could move from stabilisation to clearer expansion. Conversely, prolonged weakness in new business would likely keep purchasing activity and output growth subdued in early 2026.
For now, the December PMI offers a cautiously positive close to 2025 for Malaysia’s manufacturers. Firms have strengthened capacity through hiring and appear better placed to respond should demand conditions improve in the coming months.
Key Takeaways:
- Malaysia Manufacturing PMI remained at 50.1 in December 2025, indicating marginal expansion.
- Employment rose at one of the fastest rates on record, underpinning the sector’s improvement.
- New orders and export inflows moderated, while input purchasing stagnated and price pressures eased.
