RRI.CO.ID, Jakarta - Indonesia’s manufacturing industry showed stronger performance at the start of 2026, with activity reaching its highest level in nearly two years.

S&P Global Market Intelligence, a division of S&P Global that provides economic and financial data, reported that Indonesia’s Manufacturing Purchasing Managers’ Index (PMI) rose to 53.8 in February, up from 52.6 in January. This marks the highest level since March 2024.

An index above the 50-point threshold indicates expansion in the manufacturing sector. The February increase reflected higher production and stronger domestic demand.

S&P Global Market Intelligence economist Usamah Bhatti said manufacturing performance continued to improve in mid-first quarter 2026. “This growth provides a positive outlook for the coming months,” Bhatti said in Jakarta on Monday, March 2, 2026, as quoted by Antara.

He noted that demand trends were increasingly solid, with a significant rise in sales. Companies responded by boosting output, hiring workers, and expanding purchases of raw materials.

Bhatti added that cost pressures remained high, with manufacturers reporting higher average costs due to rising raw material prices. “Thus, the inflation rate is the lowest since last August, which then drove a low increase in factory prices,” he said.

Meanwhile, the Ministry of Industry reported that the February 2026 Industrial Confidence Index (IKI) stood at 54.02 points, indicating that most sub-sectors remained in the expansion zone.

Ministry spokesperson Febri Hendri Antoni Arif said the survey showed optimism in the manufacturing sector. Of 23 subsectors analyzed, 19 expanded while only four contracted.

Although the February IKI slowed slightly by 0.10 points month-to-month, the expanding subsectors accounted for 92.9 percent of the non-oil and gas manufacturing industry’s Gross Domestic Product (GDP). The printing and reproduction of therecorded media industry and the other transportation equipment industry recorded the highest IKI. ***