MANUFACTURING
Sector showing growth
The local manufacturing sector continued to show signs of improvement in August as Taiwan’s exports rebounded, the Taiwan Institute of Economic Research said yesterday. The institute said the manufacturing composite index for August rose 1.32 points from a month earlier to 11.84, flashing “yellow-blue” — which indicates that the sector is in a transition period between recession and growth — for the second consecutive month. Prior to July, the index saw 15 months of “blue” lights, indicating sector decline. Among the five sub-indices in the composite index, four showed signs of improvement, the institute said.
STEELMAKERS
CSC name acting chairman
Vice Minister of Economic Affairs Shen Jong-chin (沈榮津) has been named acting chairman of China Steel Corp (CSC, 中鋼) after Andrew Sung (宋志育) yesterday retired from the post. The Ministry of Economic Affairs is still discussing possible candidates with the Executive Yuan to lead the nation’s largest steel mill, local media reported. The company’s aggregate pre-tax profit for the first eight months of the year grew 24.48 percent from the same period of last year to NT$13.91 billion (US$443.5 million), the company reported earlier this week.
HOME APPLIANCES
Tatung shares plunge
Shares of Tatung Co (大同), a home-appliances manufacturer, tanked yesterday, after the Taiwan High Court ordered chairman Lin Wei-shan (林蔚山) to pay NT$2.29 billion to investors for embezzling Tatung funds to pay a NT$2 billion loan from Nature Worldwide Technology Corp (通達), a friend’s company in which Lin had invested. Lin’s actions contributed to losses of up to NT$1.7 billion for Tatung between 2007 and 2010, and triggered the Securities and Futures Investors Protection Center to file a class-action lawsuit against Lin. Tatung shares plummeted 8.27 percent to NT$7.76 on the Taiwan Stock Exchange. Lin can still appeal the case.
BANKING
Apple Pay applications open
The Financial Supervisory Commission (FSC) has started accepting applications from local banks to provide Apple Pay mobile services, DigiTimes reported on its Web site yesterday. The report said the commission would only allow credit card payments initially, while other methods, such as debit cards, might be allowed later. CTBC Bank (中國信託銀行), Cathay United Commercial Bank (國泰世華銀行), E.Sun Commercial Bank (玉山銀行) and Taishin International Bank (台新銀行) are among the banks who might start offering Apple Pay when it becomes available, the report said.
ELECTRONICS
Sharp to invest in LED
Sharp Corp is investing ￥57.4 billion (US$567 million) to develop organic LED display production facilities, with the aim of starting output by June 2018. The funds are to be used for equipment and to deliver sample products to customers, the Osaka, Japan-based company said in a statement yesterday. Sharp is investing in its factories in Mie and Osaka. The investment is part of the company’s ￥200 billion commitment to OLED technology, part of a strategic plan it adopted with its new owner, Hon Hai Precision Industry Co (鴻海精密). The proposed investment will be for smartphone displays, according to Sharp, which is among suppliers that provide screens for Apple Inc’s products.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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