AmBank Group Research warns that economic recovery in the third quarter of this year (3Q2020) could lose momentum.
According to the Head of Economics and Head of AmBank Research, Dr. Anthony Dass in his note today, his party expects the situation to occur after the Manufacturing Purchasing Managers Index (PMI) remains contracted for the fourth month in a row.
He said the index was down to 48.5 from 49 in September.
He explained that manufacturers' confidence was weakening after the increase in the number of Covid-19 cases and the new restrictions imposed to curb its spread.
As a result, new output and bookings slowed down last month compared to September.
Dass added that volatile demand caused purchasing stocks and final goods to decline last month.
"Furthermore, manufacturers are experiencing supply chain delays due to domestic and foreign restrictions due to Covid-19.
"This situation causes an increase in input prices and a lack of manufacturing capacity will cause job opportunities to decrease," said Dass.
According to Dass, it once again predicted Gross Domestic Product (GDP) this year to be at -3.6% to -5.6%
