Taiwan’s official manufacturing purchasing managers’ index (PMI) last month rose to a 15-month high of 54.9, driven by demand for electronics and biomedicine products, as market uncertainty subsided, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
About half of the manufacturing sectors reported a pickup in business, especially firms involved in the deployment of 5G products and services, the Taipei-based think tank said.
“Business improvement was most evident for firms in the global 5G supply chain,” CIER president Chen Shi-kuan (陳思寬) told a media briefing, adding that the absence of economic deterioration in the US and Europe also helped.
PMI aims to gauge the health of the manufacturing industry, with scores of more than 50 indicating expansion and those below the threshold suggesting a contraction.
The sub-index on new business orders climbed to 61 from 52.7 a month earlier, with 5G deployment being the growth driver, CIER researcher Chen Shin-hui (陳馨蕙) said.
Not only chipmakers and chip designers, but also firms supplying related chemical materials and high-performing chip-testing services and equipment reported a pickup in business, Chen Shin-hui said.
Other firms said that some orders that had been canceled were now re-established, she added.
Makers of textiles and food products fared better, with the score for new business orders rising to 70.7 from 65.6 in October, the institute’s survey found.
Seasonal and rush orders helped boost the sub-index on industrial production to 60.4 from 55.4 a month earlier, while the gauge on employment levels rose to 55.6 from 50.6, the survey found.
Order visibility for 5G demand could extend into the first quarter of next year, Chen Shin-hui said.
Still, companies producing raw materials, transportation tools, electrical and machinery equipment were not out of the woods and reduced purchasing activity, the survey said.
The sub-index on raw material prices dropped to 44.1, after scoring 46.4 one month earlier, it found.
Despite two straight months of positive PMI data, firms remain conservative with the sub-index on business prospects in the next six months coming in at 49, compared with 45.7 in October.
The slow season for component suppliers of technology products is around the corner, except for companies that are helping clients roll out 5G devices early next year.
The operating conditions for non-manufacturing sectors gained further momentum, as the non-manufacturing index (NMI) grew to 55 from 53.9, with all sectors reporting business expansion, CIER said.
It is the ninth straight month that the NMI has increased.
Service-oriented firms, such as app developers and telecoms operators, are also aiming to take advantage of 5G-related businesses, Chen Shin-hui said.
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
AI: Softbank’s stake increases in Nvidia and TSMC reflect Masayoshi Son’s effort to gain a foothold in key nodes of the AI value chain, from chip design to data infrastructure Softbank Group Corp is building up stakes in Nvidia Corp and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the latest reflection of founder Masayoshi Son’s focus on the tools and hardware underpinning artificial intelligence (AI). The Japanese technology investor raised its stake in Nvidia to about US$3 billion by the end of March, up from US$1 billion in the prior quarter, regulatory filings showed. It bought about US$330 million worth of TSMC shares and US$170 million in Oracle Corp, they showed. Softbank’s signature Vision Fund has also monetized almost US$2 billion of public and private assets in the first half of this year,
POWELL SUCCESSOR: US Fed Governor Adriana Kugler’s resignation gives Donald Trump an opening on the board, potentially accelerating his decision on the next chair US President Donald Trump suddenly has a chance to fill an opening at the US Federal Reserve earlier than expected, after Fed Governor Adriana Kugler announced her resignation on Friday. It might also force him to pick the next Fed chair months sooner than he had anticipated. “The ball is now in Trump’s court,” LH Meyer/Monetary Policy Analytics Inc economist Derek Tang said. “Trump is the one who’s been putting pressure on the Fed to do this and that, and Trump says he wants to have his own people on. So now he has the opportunity.” Kugler’s exit unfolds amid unprecedented public pressure
RSS