The official manufacturing purchasing managers’ index (PMI) registered 54.9 last month, bounding back to positive territory, as companies emerged from holiday disruptions and the launch of new handsets by Apple Inc also lent support, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
The rebound has more to do with a low base of comparison in February than signs of a recovery because the reading after seasonal adjustments continued to contract, although at a milder pace, the Taipei-based institute said.
“A recovery remains elusive, even though the operating conditions showed improvement last month and beyond,” CIER president Wu Chung-shu (吳中書) told a news conference.
The PMI is an important economic bellwether aimed at gauging the health of the manufacturing industry’s operating conditions, with scores above 50 indicating improvement and values below the threshold reflecting deterioration.
The Nikkei Taiwan Manufacturing PMI arrived at similar findings, as the index printed 51.1 on the back of new orders, according to the survey compiled by London-based research body Markit.
With the exception of the food and textile sectors, firms in different industries all reported improving businesses, raising the sub-index on new orders to 61.3 last month, from 37 in February, the CIER report said.
The launch of Apple Inc’s iPhone SE models last month gave a boost to local technology firms in its supply chain, Supply Management Institute in Taiwan (中華採購與供應管理協會) executive director Steve Lai (賴樹鑫) said.
The relatively low-priced SE series aims to fill the void ahead of the introduction of the iPhone 7 in September, Lai said, adding that consumers have given it a warm welcome so far.
However, it remains to be seen if the excitement will turn out to be short-lived, as was the case for the iPhone 6S, Lai said.
The US technology giant is tapping the software market by making its devices useful for professional baseball players in the analysis of moves by their rivals, Lai said.
The expanded use might not translate into new business for Taiwanese contract makers in the short term, but things might change if they manage to take advantage of the shift in tastes, Lai said.
The CIER report also showed output sub-index soared to 63.8 last month from 29.4 in February, while that for export orders rose from 42.1 to 56.6.
The business landscape might continue to brighten, as the six-month outlook sub-index registered 51.8, meaning a majority of firms are expecting better prospects, the report said.
The business upturn also extended to non-manufacturing sectors with the NMI climbing to 50.5 last month, from 42.9 in February, a separate CIER report said yesterday.
However, service-oriented companies have a grim outlook in light of the six-month outlook standing at 38.1, the report showed.
In particular, companies involved in property construction and brokerage remained the drag due to sluggish market demand, Wu said.
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