ASIA’S factory activity grew in December as companies took rising global cases of the new Omicron coronavirus variant in stride, though persistent supply constraints and rising input costs clouded the outlook for some economies.

The direct hit from Omicron on output appeared subdued, according to surveys released Monday and yesterday.

China’s factory activity grew at its fastest pace in six months in December, and other parts of Asia also fared well with factory activity expanding in countries ranging from Vietnam, Malaysia and the Philippines.

“Manufacturing PMIs and timely trade data reveal that Asia’s export-focussed industry gained momentum at the turn of the year,” said Alex Holmes, emerging Asia economist at Capital Economics.

“While the Omicron variant presents a key threat to the outlook, it is unlikely to cause nearly as much disruption to industry as Delta did in the third quarter,” he said.

In Japan, the world’s third-biggest economy, manufacturing activity in December grew for an 11th straight month. And bellwether exporter South Korea saw its main factories gauge enjoy the fastest pace of expansion in three months, the surveys showed.

Japan’s PMI stood at 54.3 in December, remaining above the 50-mark threshold that indicates expansion in activity but lower than November’s 54.5 as new order growth softened.

South Korea’s PMI rose to 51.9 from 50.9 in November to mark the 15th consecutive month of expansion, as rising domestic demand offset sluggish overseas sales.

India’s manufacturing activity continued to expand in December though at a slower pace than in November.

Manufacturing activity in the eurozone also remained resilient at the end of 2021 as factories took advantage of an easing in supply chain bottlenecks and stocked up on raw materials at a record pace, a survey showed.

IHS Markit’s final manufacturing Purchasing Managers’ Index (PMI) dipped to 58 in December from November’s 58.4, matching an initial “flash” estimate and still comfortably above the 50 mark separating growth from contraction.

(SD-Agencies)