The nation’s industrial production continued to show growth last month, rising 6.08 percent from a year earlier, following an annual increase of 8.63 percent the previous month, data released by the Ministry of Economic Affairs showed yesterday.
The increase in industrial production for last month represented the sixth consecutive month of improvement, with the industrial production index posting a reading of 112.26, hitting the highest level on record, according to the ministry’s tallies.
Last month’s industrial output grew by 4.03 percentage points from June. Following seasonal adjustment, it fell 0.34 percentage points from the previous month, the ministry said in a press release.
The industrial production index measures output in five major industries — manufacturing; mining and quarrying; electricity and gas supply; water supply; and architectural engineering — and is expressed as a percentage of real output in the base year of 2011 with a score of 100.
The latest production gauge showed that output from the manufacturing sector — which accounts for more than 90 percent of industrial output — grew the most, climbing 6.77 percent last month from a year earlier that was followed by an increase of 5.75 percent in the electricity and gas supply industry and 0.34 percent in the water supply industry.
However, output in the construction engineering industry slumped 18.39 percent from a year ago, while the mining and quarrying industry declined 15.37 percent, the ministry’s report showed.
“Taiwan’s industrial production surprised on the upside [last month],” Moody’s Analytics associate economist Katrina Ell said in a research note yesterday, comparing the 6.08 percent increase with the previous month’s 8.63 percent growth.
“Uncertainty over smartphone and tablet computer product launches appears to have led to a slowdown in export orders and manufacturing early in the third quarter. We expect this is temporary with global tech demand on a slow upward trend,” Ell said.
Taking a closer look at the various sectors within the manufacturing industry, output from the information and electronics sector posted the biggest increase of 9.9 percent from a year ago, followed by the metals and machinery sector’s 6.52 percent growth, according to the ministry’s report.
A narrower classification by industrial products showed that production of computers, electronic devices and optical products increased the most last month, surging 11.08 percent year-on-year, mainly due to rising demand for high-end handset lenses and the recovery of the PC market, the ministry said.
Production of electronic parts and components (including semiconductors and flat panels) posted the second-highest increase at 9.67 percent year-on-year last month, which the ministry attributed to increased capacity seen in wafer foundry companies, chip packaging and testing firms and LED lighting producers.
Basic metals, chemical materials, machinery equipment and vehicles and automobile parts all grew by the teens year-on-year in the month, suggesting that domestic manufacturing continued to underpin industrial production.
For this month and this quarter, the ministry said manufacturing output is expected to continue growing amid strengthening tech demand on the back of the stabilizing global economy. Momentum is also expected to gain support from the restocking demand ahead of China’s October holiday shopping spree, the ministry said.
Based on the ministry’s latest survey of domestic manufacturers, about 12.5 percent of those polled expected their production to be higher this month from last month, while 71.7 percent expected production to remain flat and 15.8 percent predicted a fall in output.
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