Taiwan’s manufacturing activity remained in expansion mode for the 16th consecutive month in October as the index gauging the overall conditions of the sector stopped a two-month falling streak, the Chung-Hua Institution for Economic Research (CIER) said on Monday.
Data compiled by CIER, one of the leading economic think tanks in Taiwan, showed the local Purchasing Managers’ Index (PMI) for October rose 0.5 points from a month earlier after seasonal adjustments to 58.3 following a 3.1 decline in August and a 4.3 decline in September.
The increase largely reflected improving factors in the index, including new orders and inventories, CIER said.
Also in October, the non-manufacturing index (NMI), which covers service sector activity, rose 1.2 points from a month earlier to 58.5, marking the fourth straight month of expansion, CIER added.
For the PMI and NMI, readings above 50 indicate expansion, while those below 50 represent contraction.
Among the five major factors in the PMI, the sub-indexes on new orders, employment and inventories moved higher from a month earlier by 3.3, 0.7 and 2.9, respectively, to 56.8, 55.2 and 58.0, with all being in expansion mode in October, CIER said.
On the other hand, the sub-indexes on production and supplier deliveries moved lower by 1.1 and 3.4 points, respectively, from a month earlier to 55.9 and 65.7 in October, but they still remained in expansion, CIER added.
In addition, the sub-index on the business outlook over the next six months also fell 1.3 from a month earlier to 54.2 in October, but the pace of expansion was the slowest since August 2020, when the sub-index stood at 53.5, according to CIER.
Despite an increase in the sub-indexes on new orders, employment and inventories in October, CIER President Chang Chuang-chang (???) said the pace of expansion of the three factors moderated from 60-70 seen in the first half of this year due to port congestions in the United States, a delay in shipments and a shortage of key electronics components.
Chang said if such unfavorable situations continue, manufacturers will face growing pressure to raise product prices.
As for the six major industries, CIER said, the sub-indexes on the chemicals and biotech, food and textiles, and electrical equipment and machinery industries moved higher from a month earlier in October, while the sub-indexes on the electronics/optoelectronics, basic raw materials and transportation equipment industries moved lower.
However, all of the six industries remained in expansion mode with the pace of growth in the food and textiles industry being the fastest, according to CIER.
Among the four major factors in the service sector’s NMI, the sub-indexes on business activity and new orders moved higher by 4.6 and 2.1, respectively, from a month earlier to 61.3 and 59.0 in October.
CIER said the business activity and employment factors moved in expansion mode for the fourth consecutive month after hitting a recent low in June.
Bucking the upturn, the sub-indexes on employment and supplier deliveries moved lower by 1.2 and 0.7 points, respectively, to 56.6 and 57.3 in October, but remained in expansion, according to CIER.
Source: Focus Taiwan News Channel