In a significant shift, Malaysia's producer prices experienced their first drop in September, concluding a streak of seven months of growth. The producer price index (PPI) decreased by 2.1% year on year, marking the first decline since January. Earlier in August, the PPI had recorded a modest growth of 0.3%.
The steep drop was driven primarily by a notable decline in the mining sector's prices, which fell by a staggering 16.1%. This sector's downturn included significant reductions in crude petroleum and natural gas extraction, which declined by 18.6% and 7.9%, respectively. The manufacturing sector also faced challenges, contracting by 1.5%, largely due to a slump in the production of coke and refined petroleum products, which dropped by 18.7%.
In contrast, the agriculture, forestry, and fishing sectors reported positive growth, with a 5.8% increase, credited to a remarkable 11.2% rise in perennial crops. Additionally, both the water supply and electricity and gas supply indices experienced modest increases of 7.8% and 0.3%, respectively. Month-on-month, local production of the PPI dipped by 1.5% in September.
When examining the third quarter, local production PPI saw a slight decline of 0.2%, compared to a more pronounced drop of 1.6% in the previous quarter, with the ongoing struggles in the mining sector heavily influencing these figures..