Mon, Sep 26, 2011 - Page 12 News List

Business report to downgrade to ‘yellow-blue’

INDICATING GLOOM:What is normally a busy export season has been badly affected by the US and eurozone debt crises, an economics expert said

Staff writer, with CNA

The index of leading indicators for last month is likely to show a downgraded “yellow-blue” light amid a gloomy global economy, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) forecast yesterday.

The Council for Economic Planning and Development (CEPD) is scheduled to release the monthly economic indicators tomorrow.The August-September period is usually a busy export season, but the debt crises in the US and Europe have made the situation “chaotic,” said Gordon Sun (孫明德), deputy director of the economic forecasting center at the TIER, an independent non-profit research organization.

According to the TIER, high-tech exports to the Western Hemisphere decreased last month compared with the same time last year.

Meanwhile, the tight monetary policy in China has affected exports to China, mostly in the traditional industries of cement and construction, the TIER’s deputy director said.

The TIER projected that the council report would show a downgraded “yellow-blue” light for last month, although the business indicators for July continued to flash an optimistic “green light” for the fifth consecutive month.

Among the nine components of the overall index, the stock prices indicator, the industrial production indicator and the customs-cleared exports indicator are likely to drop one notch, the TIER forecast.

Last week, the Ministry of Economic Affairs reported that export orders increased 5.26 percent year-on-year last month to US$36.71 billion, which was the slowest in nearly 22 months, while the industrial production index rose 3.88 percent year-on-year last month, also a sharp drop from the double-digit growth seen early this year.

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