JAKARTA (Reuters) - Indonesian manufacturing activity continued to expand strongly in July as companies boosted output and hired more workers to meet robust new orders, the HSBC Markit purchasing managers' index (PMI) survey showed on Friday.
The index was 52.7 in July, unchanged from the previous month's record high. A reading above 50.0 signals expansion.
Output expanded at a record rate as order books grew.
However, while overall orders rose, new export orders fell for a second straight month.
"Given the ongoing pressures on Indonesia's trade and current account deficits, this pick-up in domestic activity is not a positive sign," said Su Sian Lim, economist at HSBC. "Bank Indonesia needs to remain vigilant and maintain a hawkish stance."
Employment levels rose for the second consecutive month. Although the pace of job creation was modest, it was the largest rise in workforce numbers since July 2013.