ASEAN Manufacturing Rebounds as China and India Slow in July

Manufacturing activity across Asia and Europe showed divergent trends in July. S&P Global reports that the ASEAN manufacturing sector rebounded, with the region's purchasing managers' index rising to 52.8 from 50.5 in June. This acceleration was led by Thailand and Vietnam, driven by demand for AI-related electronics and strengthened business confidence, though Myanmar remained in contraction.

In contrast, China's manufacturing momentum cooled. The official PMI unexpectedly fell to 49.2, while the RatingDog index dropped to 50.9. Despite this slowdown, China saw its first return to export order expansion in three months and the fastest employment growth since August 2023. India's sector also slowed, with the S&P Global HSBC India Manufacturing PMI falling to 53.5, marking its slowest expansion in nearly five years due to soft domestic demand.

In Europe, Poland's manufacturing downturn eased as its PMI rose to 49.0 from 46.1. While still in contraction, the pace of decline in output and new orders slowed, and the country recorded its first headcount increase since April 2025. Across these regions, a common trend emerged in pricing, as input cost inflation generally slowed, though some firms began passing these costs to customers to protect margins.