Bareksa.com - Indonesian manufacturing activity rose to a record high for the second consecutive month in June, as a rise in new orders led firms to boost production, an HSBC Markit purchasing managers' index (PMI) survey showed on Tuesday.

The index rose to 52.7 in June from 52.4 in May, the highest reading since the survey began in April 2011. A reading above 50.0 signals expansion.

Strong domestic demand for new orders offset a moderate drop in export orders, the first in six months.

"Given the import-driven pressures on Indonesia's trade and current account deficits, such pick-up in domestic activity is not desirable at this juncture," said Su Sian Lim, economist at HSBC.

"Bank Indonesia needs to remain vigilant, even if inflationary pressures appear to be receding now."

(Source : Reuters)