Sat, Dec 29, 2012 - Page 13 News List

Manufacturing struggling: TIER

SENTIMENT DOWN:After nine straight low months, manufacturing is facing a tough period. However, its outlook next year could be better, the institute said

By Amy Su  /  Staff reporter

The manufacturing sector showed a “blue” indicator for the ninth straight month last month, implying a continuous slump in sentiment, data from the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) showed yesterday.

However, the Taipei-based think tank expected the sector’s sentiment to stage a significant rebound in the second quarter of next year by returning to a “yellow-blue” indicator.

Cyclical movement was 10.02 points last month, up 0.75 points from the previous month’s 9.27 points, closer to the threshold for “yellow-blue,” which falls between 10.5 and 13 points, the institute said in its monthly report.

Differentiating by industries, those flashing “blue” accounted for 63.3 percent of total industries last month, down 7.35 percentage points from October, while industries flashing “yellow-blue” accounted for 29.49 percent, the report said.

The remaining 7.91 percent of industries flashed a more optimistic “green,” implying steady sentiment, the report’s data showed.

Gordon Sun (孫明德), director of the institute’s macroeconomic forecasting center, said he did not expect the manufacturing sector to show strong recovery this month, following the end of a peak period for the manufacturing industry.

However, Sun said the sector’s sentiment in January next year could be better, as the Lunar New Year may raise demand in certain manufacturing sectors.

Sun expected manufacturing to show improvements in the second quarter next year, driven by a global economic recovery.

However, the US’ “fiscal cliff” issue could be a major area of uncertainty in the first quarter of next year, with the expected depreciation of the Japanese yen another factor that could impact Taiwan’s manufacturing.

Last month, sentiment in the electronic components sector had shown some improvement, showing a “yellow-blue” indicator, ending a series of “blue” levels for eight straight months previously, on the back of the year-end sales, the institute said.

Meanwhile, rising demand and companies’ optimistic outlooks also made the oil and coal sector show a “green” light last month, from “yellow-blue” in October, TIER figures showed.

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