PETALING JAYA: The manufacturing sector appears set for a cautious start to 2026, with indicators pointing to a moderation in growth amid rising global risks.
Quarter-to-date, the purchasing managers’ index (PMI) has averaged 49.8, unchanged from the fourth quarter of 2025 (4Q25), suggesting that manufacturing sector performance in real gross domestic product (GDP) terms is likely to remain within last quarter’s range, according to TA Research.
“According to S&P Global’s historical comparison, the latest PMI reading is consistent with annual GDP growth of just under 5%,” the research house said, while cautioning that reliance on the PMI alone may be misleading, as the broader economy is also shaped by services and other sectors.
TA Research noted that the deceleration trend aligns with its view that GDP is likely to contract on a quarter-on-quarter basis in 1Q26, moderating annual growth to 5.4% from 6.3% in 4Q25.
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