The nation’s economic monitoring signal last month flashed a “blue” light for the fifth straight month, with both indices of leading and coincident indicators dropping and showing no signs that the slowdown would ease, the Council for Economic Planning and Development (CEPD) said yesterday.
The dismal figures suggested that the economy would remain weak, posing a tougher challenge for the government.
“The business cyclical signal flashed a fifth consecutive blue light in January, indicating a sustained economic downturn,” Hung Jui-bin (洪瑞彬), director-general of the council’s economic research department, told a press briefing.
The index of leading indicators, which is used to gauge the nation’s economic landscape in the coming six months, fell 4.9 percent to 84.4 points last month from the previous month, the CEPD report showed.
All components making up the index of leading indicators — except for M1B money supply — were trending downward, with the semiconductor book-to-bill ratio, export orders and average monthly overtime in industry and services leading the decline in the index, the report said.
Hung said the government’s consumer voucher program helped boost the M1B, which includes currency held by the public and demand deposits, back to positive territory.
But the change in the M1B component was not strong enough to lift the monitoring signal from a “blue” light (recession) to a “yellow-blue” (economic slowdown), he said.
Meanwhile, the council’s monthly index of coincident indicators fell 7.3 percent to 76.4 points last month from a month earlier, the report said.
All components of the economic barometer, used to reflect the current economic and financial situation, showed declines, with power consumption, customs-cleared exports and industrial output reporting the biggest falls, the report showed.
Though retailers and restaurants saw modest increases in business volume, the sub-index contracted 10.6 percent, from minus 11 percent a month earlier, the report said.
CEPD researcher Wu Ming-huei (吳明蕙) attributed the slight improvement to the consumer voucher program, but added that it was too early to gauge the impact of the stimulus.
The overall data reaffirmed an across-the-board slump that may plague the nation until the fourth quarter, she said.