The economy remained sluggish last month, but showed signs of a pickup, with machinery and electrical equipment imports improving, the National Development Council (NDC) said yesterday.
The government’s business monitoring system rose by 2 points to 18 last month, moving into the “yellow-blue” zone, from “blue” in April, a sign that Taiwan’s export-oriented economy is shifting gears, hopefully back to the course of a modest recovery with the advent of the high sales season for local manufacturers, the council said in a statement.
April’s “blue” reading had raised concern over an economic downturn after the global recovery proved weaker than expected in the first quarter.
POSITIVE MOMENTUM
While the overall score for the nine business gauges on the council’s business monitoring system picked up, only two component indices — M1B money supply and machinery and electrical equipment imports showed positive momentum, the council’s report said.
Other sub-indices stayed in negative territory, in line with poor showings in other economic data released by the government, including exports, industrial output and retail sales, the council said.
Meanwhile, the council’s leading indicator, a reflection of the economic landscape three to six months earlier, shed 0.41 percent last month, slipping for the 14th consecutive month, it said.
SLOWDOWN EASING
However, the pace of the slowdown eased, it said, a sign that the situation might grow less disappointing going forward, the report said.
The coincident index, a reflection of incumbent economic conditions, dropped 0.72 percent last month from April given weaker data, the report said.
Taiwan is home to the world’s major chipmakers, chip designers and handset, personal computer and critical component suppliers. Earlier this week, Yuanta-Polaris Research Institute (元大寶華研究院) voiced concern over the increasing lack of growth drivers in Taiwan, as China is reducing its dependence on Taiwan’s electronics products.
Central bank Governor Perng Fai-nan (彭淮南) on Thursday also urged Taiwanese firms to reinvent themselves and overcome growing competition from China.
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