By Yantoultra Ngui

KUALA LUMPUR--Malaysia's manufacturing activity worsened in October as production fell in line with the biggest decline in new orders since November 2015.

The Nikkei manufacturing purchasing managers' index, a gauge of factory activity, was at 47.2 in October versus 48.6 in September. A PMI reading below 50 indicates a contraction, while a reading above that signals an expansion.

The latest figure was the lowest since June, and below the longer-term average of 49.5, according to the survey released Tuesday by IHS Markit.

"The start of the final quarter of 2016 set off on a bad footing for the Malaysian manufacturing sector, with operating conditions deteriorating at a solid pace," said Amy Brownbill, economist atIHS Markit, in a statement.

On a more positive note, manufacturers benefited from an easing of inflationary cost pressures, as input prices rose at the slowest pace since July 2015. The allowed manufacturing firms to lower their charges for the first time in 21 months, Ms. Brownbill said.

Write to Yantoultra Ngui at yantoultra.ngui@wsj.com

(END) Dow Jones Newswires

October 31, 2016 21:11 ET (01:11 GMT)

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