Tue, Jul 29, 2014 - Page 13 News List

Economic indicators point to recovery, council says

ON TRACK:Increases in the local stock index and imports of machinery and electrical equipment aided the 2-point rise in the overall score in June

By Camaron Kao  /  Staff reporter

The National Development Council’s index of economic monitoring indicators rose 2 points to 26 last month, indicating that the economy is on the way to recovery.

The council’s report released yesterday showed that the total score — which takes into account both leading and coincident indicators — rose last month because of higher year-on-year growth in the local stock index and imports of machinery and electrical equipment.

As a result, the monitoring indicators flashed “green” for the fifth consecutive month, the council said, adding that the last time they were up for five consecutive months was from March to July 2011.

The council uses a five-color spectrum to categorize the nation’s economic health, with “blue” signaling a recession, “green” steady growth and “red” overheating, while “yellow-blue” indicates a transition between recession and growth, and “yellow-red” a transition between growth and overheating.


“The rising score last month should remove worries that the relatively high scores over the past few months were just a short-term phenomenon,” National Development Council Deputy Minister Chen Chien-liang (陳建良) said at a press conference.

Chen said that the council was optimistic that the economic light would remain “green” in the next few months.

The index of leading economic indicators, which is used to gauge the nation’s short-term economic outlook, edged down 0.19 points to 100.11 last month, from 100.3 points a month earlier, the report showed.

Although it was the fourth consecutive month of decline, Chen said it should not be a concern because the fall was mild.


Meanwhile, the index of coincident indicators, which reflects monthly economic conditions, increased for the 14th consecutive month to 101.23 points, up 0.22 points from 101.01 the previous month, the report said.

Chen said he expects the housing market in China as well as the geopolitical tensions between Russia and Ukraine and in the Gaza Strip could pose a threat to the economic growth.

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