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ASEAN PMI falls to contraction in July

TOKYO -- The Nikkei ASEAN Manufacturing Purchasing Managers' Index, or PMI, fell to contraction for the first time this year with falls in both output and total new orders.

The composite indicator of manufacturing performance fell to 49.3 in July from 50.0 in June, the first below-50 reading since December.

A reading above 50 indicates economic expansion, while a reading below 50 points toward contraction.

Two of the seven countries covered by the survey saw growth across their manufacturing sectors, down from four in June. The Philippines and Vietnam remained the top two performers and the only countries that conditions improved.

"Latest data signaled a renewed fall in client demand -- which was not limited to just the domestic market but also included foreign demand," said Bernard Aw, economist at IHS Markit, which compiles the survey.

"Weaker demand had an impact on production volumes and backlogs, which in turn harmed employment prospects," the economist said.

"Moreover, business optimism remained below the historical average, reflecting uncertainties over manufacturing growth across the region."


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