FX.co ★ Indonesia Manufacturing Stalls as Middle East Tensions Weigh

Indonesia’s S&P Global Manufacturing PMI fell to 50.1 in March 2026 from 53.8 a month earlier, indicating conditions were close to stagnation. Output declined after four consecutive months of expansion, marking the sharpest drop since June 2025, as the Middle East conflict and global uncertainty weighed on activity. New orders weakened for the first time in eight months, and export demand retreated following a rise in February. Backlogs of work shrank for the first time since October, prompting modest job cuts for the second time in three months. Purchasing activity also decreased, its first decline since July 2025. Supplier delivery times lengthened to their worst level since October 2021, extending a six‑month stretch of delays driven by material shortages and shipping disruptions. On the inflation front, cost pressures strengthened, with input price inflation reaching a two‑year high and prompting firms to raise selling prices at the fastest rate since June 2022. Looking ahead, business sentiment improved slightly, underpinned by expectations of a recovery in demand and an easing of geopolitical tensions.