The nation’s economic picture showed more clear and stable signs of recovery last month as the leading economic indicators rose for the eighth month in a row with all seven components moving up, the Council for Economic Planning and Development (CEPD) said yesterday.
The index of leading indicators, used to project the economic landscape three to six months ahead, gained 1.7 percent from August to 101 points last month, while the annualized six-month rate of change advanced 3.3 percentage points, the CEPD report showed.
The total score of monitoring indicators for last month was 19 points, up from 18 points in August and flashed a fourth consecutive “yellow-blue light” that indicated the economy was in a transitional period of shifting from slowdown to steady growth, the report said.
CAUTIOUS OPTIMISM
“We are cautiously optimistic the economy will further improve in coming months, propped up by better external demand,” Hung Jui-bin (洪瑞彬), director-general of the council’s economic research department, told a media briefing.
Hung attributed his measured confidence to the fact that the annual decline in export orders narrowed to 3 percent last month, while total value exceeded US$30 billion, about the same level they were at before the recession.
The semiconductor book-to-bill ratio has increased, the report said.
The sub-index has surpassed the benchmark for three consecutive months, standing at 1.17 last month, from 1.06 a month earlier, the report said.
If the value is greater than 1, it means a firm has more orders than it can deliver.
FUNDAMENTALS
“Economic fundamentals showed noted improvement, although they were still outperformed by the financial front,” Hung said.
The stock price index expanded 18 percent year-on-year last month, from a 3 percent decline a month earlier, chiefly because of a low base, the report said.
The index of coincident indicators, used to reflect current economic conditions, rallied 1.7 percent to 96.6 points, while the trend-adjusted reading rose 2.1 percent to 101.4, the report said.
Wu Ming-huei (吳明蕙), chief of the council’s research division, said a value above 100 indicates recovery and it was the first time the adjusted coincident index met the test following the slump.
“Except for real manufacturing sales that dropped 10.4 percent from last year, all other indicators either eased to single digits or moved back to positive territory,” Wu said.
Electric power consumption, industrial production, export shipments, imports of capital goods as well as wholesale, retail and food services data all grew, it said.
The decline in nonagricultural employment decelerated to 1.5 percent from last year, from 2 percent a month earlier, the report said.
Both leading and coincident indexes are set to climb higher this quarter owing partly to a low base last year, Wu said.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
Semiconductor shares in China surged yesterday after Reuters reported the US had ordered chipmaking giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to halt shipments of advanced chips to Chinese customers, which investors believe could accelerate Beijing’s self-reliance efforts. TSMC yesterday started to suspend shipments of certain sophisticated chips to some Chinese clients after receiving a letter from the US Department of Commerce imposing export restrictions on those products, Reuters reported on Sunday, citing an unnamed source. The US imposed export restrictions on TSMC’s 7-nanometer or more advanced designs, Reuters reported. Investors figured that would encourage authorities to support China’s industry and bought shares
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said