Tue, Jul 05, 2016 - Page 12 News List

Manufacturers optimistic over coming high season

By Crystal Hsu  /  Staff reporter

The nation’s official manufacturing purchasing managers’ index (PMI) came in at 53.3 last month, settling above the neutral mark for the fourth straight month, as operating conditions continued to improve thanks to the approaching high-sales season for technology products, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.

The data showed a marginal decline of 1.6 points from May’s 54.9, indicating that the pace of improvement is moderate, fragile and not broad-based.

“The manufacturing industry has bottomed out and is on a slow course to recovery as evidenced by the PMI figures,” CIER president Wu Chung-shu (吳中書) told a news conference.

PMI surveys aim to analyze the health of the nation’s manufacturing industry, with scores above 50 indicating expansion and values below the threshold suggesting a contraction.

All constituent indices showed positive cyclical movements and the upturn extended to all manufacturing sectors except electrical and machinery equipment, the institute said.

The sub-index on new orders and export orders registered 55.3 and 50.3 respectively last month, slowing from 58 and 53.6 respectively in May, as some sectors fared better than others.

Companies in the supply chains of global technology giants are benefiting from the preparation to introduce next-generation products in fall, Supply Management Institute in Taiwan (中華採購與供應管理協會) executive director Steve Lai (賴樹鑫) said.

US procurement executives do not foresee major disruptions for the remainder of the year, despite the UK’s decision to leave the EU, Lai said, citing a poll by the US Institute for Supply Management.

US manufacturers remain more upbeat about their business prospects in the second half compared with the first half, and Taiwanese firms voiced similar views, although the confidence level slackened over the past three months, Lai said.

More than a majority of local manufacturers expect their revenue, profit and capacity to increase in the rest of the year from current levels, according to a semi-annual survey.

The improvement extended to non-manufacturing sectors as the non-manufacturing index last month rebounded to 51.7 from May’s 47.9, but non-manufacturers are less optimistic than manufacturers, a separate report found.

The weak sentiment is more evident among hotels, restaurants and construction companies, as cooling cross-strait ties worry hospitality providers and sluggish property transactions weigh on real-estate developers, the report said.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top