Regional Manufacturing Struggles Against Tariff Headwinds

China’s Factory Growth Erodes Despite Trade Truce Signals

South Korea’s Trade Deal Offers Limited Relief

Mixed Manufacturing Trends Across Southeast Asia

Source: Reuters

The Indian central bank's short dollar book in the offshore derivatives market climbed in September for the first time in seven months, reflecting its efforts to stem the rupee losses.

The Reserve Bank of India's net short forward position — the amount of dollars it has agreed to sell in the future at a predetermined price — rose by $6 billion to $59.4 billion, according to Bloomberg calculations based on the central bank data.

The RBI's intervention isn't limited to forwards — it has also been selling dollars in the onshore market to support the rupee, traders said Monday. The currency hit a record low of 88.8050 per dollar in September, weighed by punitive US tariffs, and remains Asia's worst performer this year even as a gauge of the dollar eased, lifting most regional peers.

The rise in the forwards book "shows the RBI doesn't want speculative positions to develop when nothing fundamentally has changed for the currency," said Dhiraj Nim, currency strategist at Australia and New Zealand Banking Group in Mumbai. He expects the central bank to allow a "controlled, gradual depreciation" going forward.

Bloomberg News reported in early October that the RBI has ramped up its presence in offshore markets — a reversal after months of scaling back such activity.

The central bank's actions signal it will allow some currency flexibility but will step in when needed to crush any speculative bets, traders said last month.

Meanwhile, Deputy Governor Poonam Gupta said last week that the RBI does not view a weak exchange rate as a policy tool to gain competitiveness amid global trade tensions.

The RBI's net short position in maturities of up to one month rose to $16.5 billion in September, as against $5.9 billion in the previous month, according to central bank data. The rupee traded steady at 88.79 per dollar on Monday.

Source: Bloomberg

QatarEnergy has awarded Samsung C&T Corp the engineering, procurement and construction contract for a carbon capture and storage (CCS) project that will serve existing natural gas liquefaction facilities in Ras Laffan Industrial City.

"The new project will capture and sequester up to 4.1 million tons of CO2 per annum, making it one of the world's largest of its kind and placing Qatar at the forefront of global large-scale carbon capture deployment, reinforcing its leadership role in providing responsible and sustainable energy", state-owned integrated energy company QatarEnergy said in a press release.

It said it had "launched" its first CCS project, with a capacity of 2.2 million metric tons per annum (MTPA), in 2019.

"Two other ongoing CCS projects will serve the North Field East and North Field South expansion projects, capturing and storing 2.1 MTPA and 1.2 MTPA of CO2 respectively", QatarEnergy added.

QatarEnergy president and chief executive Saad Sherida Al-Kaabi, who is also Qatar's energy minister, said, "All our LNG expansion projects will deploy CCS technologies, with an aim to capture over 11 MTPA of CO2 by 2035."

QatarEnergy aims to double its liquefied natural gas (LNG) production capacity to 160 MMtpa through the North Field expansion projects in Qatar and Golden Pass LNG in Texas.

The United States project will begin production by year-end, Al-Kaabi told the World Gas Conference in Beijing earlier this year.

The first liquefaction train from the North Field east expansion project will start production by mid-2026. "As for North Field West, it is in the engineering phase and will be going into the construction phase somewhere in 2027", Al-Kaabi said then.

"QatarEnergy will be the largest single LNG exporter as a company while Qatar, as a country, will be the second-largest exporter of LNG after the United States for a very long time", Al-Kaabi added.

In a separate project, QatarEnergy also contracted Samsung C&T Corp to build the 2,000-megawatt (MW) Dukhan solar power plant, which would more than double the Gulf state's solar generation capacity.

QatarEnergy expects the two-phase project to start up 1,000 MW by 2028. The second phase is expected to be completed mid-2029, according to a statement by QatarEnergy September 16.

"When completed, the Dukhan solar power plant along with Al-Kharsaah, Mesaieed, Ras Laffan solar power plants will help reduce carbon dioxide emissions by about 4.7 million tons annually, while contributing up to 30 percent of Qatar's total peak electricity demand", said Al-Kaabi.

The plant will rise about 80 kilometers (49.71 miles) west of Doha, QatarEnergy said.

Source: Rigzone

The Dutch manufacturing sector continued to expand in October, but at a slower pace than the previous month, according to the latest Nevi Netherlands Manufacturing PMI data released Monday.

The headline PMI fell to 51.8 in October from September's 38-month high of 53.7, indicating a modest improvement in manufacturing conditions but with reduced momentum across all five PMI components.

New orders remained the main growth driver despite slowing from September's recent peak. The sector benefited from renewed expansion in export orders, with increased interest from customers in Europe and the Asia-Pacific region.

Manufacturing output continued its expansion that began in March, growing at a rate broadly in line with the series average. Companies increased their purchasing quantities at the strongest rate in over three years, partly in response to supply chain disruptions.

Suppliers' delivery times lengthened again in October due to shortages, capacity pressures, and delays at ports and shipping routes caused by strikes. Pre-production inventories decreased slightly as firms worked to optimize stock levels.

On the pricing front, input costs rose only slightly, with higher food, energy, wage and raw material costs cited as the main drivers. Only the investment goods segment reported increased input costs. Despite this, firms raised their selling prices at a moderate rate across all manufacturing sub-sectors, with both input cost and charge inflation receding to one-year lows.

Employment fell for the first time since May amid reduced backlogs of work. Companies attributed lower headcounts to voluntary departures, restructuring, and cuts to temporary staff.

Albert Jan Swart, Manufacturing Sector Economist at ABN AMRO, noted a dichotomy in Dutch industry, with high-tech production improving while energy-intensive sectors face pressure. He highlighted that three chemical factories in Chemelot near Geleen are closing, following earlier factory closures in the Rotterdam region.

Manufacturer confidence about the year ahead remained positive but subdued compared to historical averages, with 42% of firms expressing optimism based on new client wins and plans to expand product offerings and capacity.

Source: Investing

Pakistan's manufacturing sector showed signs of improvement in October, with the HBL Pakistan Manufacturing PMI rising to 49.6 from 48.0 in September, though it remained below the 50.0 neutral threshold for the second consecutive month.

The latest data indicated only a fractional deterioration in the health of the sector, as manufacturing production continued to decline but at a softer pace than in September. This marked the first instance of back-to-back output contractions in the survey's history, which began in May 2024.

New orders decreased for the sixth consecutive month, though the rate of decline eased from September. Manufacturers cited several factors hindering demand, including inflation, taxation, electricity load shedding, and subdued client confidence. New export orders fell for the fourth straight month.

The survey revealed a record depletion in backlogs of work, with the rate of reduction accelerating from September to the most prominent level in the 18-month series history. This excess capacity led firms to reduce headcounts for the fifth consecutive month.

Input costs continued to rise markedly in October, though at a slightly slower pace than in September. Respondents attributed the increase to higher raw material prices and tax burdens. In response, manufacturers raised their output prices at the fastest rate in three months to protect margins.

Purchasing activity decreased for the second month in a row, with the latest decline being the steepest in the survey's history. Stocks of finished goods fell for the fifth time in six months as some firms favored using existing inventories to complete orders rather than expanding production.

Despite these challenges, manufacturers maintained an optimistic outlook for output growth over the next 12 months, supported by expectations of easing cost pressures and planned business expansion. However, the degree of confidence declined for the fourth consecutive month as firms expressed concerns about how quickly inflationary pressures might ease.

Humaira Qamar, Head of Equities & Research at HBL, noted that while the Large-scale Manufacturing Index improved by 4.4% in the first two months of fiscal year 2026, the latest PMI reading suggests emerging headwinds in the near term.

She added that "green shoots in the manufacturing economy are likely to reemerge, supported by strong business confidence and a gradual strengthening of demand-side conditions."

Source: Investing

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