The official manufacturing purchasing managers’ index (PMI) last month climbed to 61.2, the fastest advance since March 2017, as all sectors reported an upturn in business on the back of holiday demand and optimism over COVID-19 vaccines, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
The latest PMI data marked a fifth consecutive month of gains, helped by customers in various parts of the world frontloading orders as the COVID-19 pandemic created shipping difficulties, the Taipei-based think tank said.
“Business in sectors previously hit by the pandemic returned to normal, while growth momentum for electronics suppliers accelerated further,” CIER president Chang Chuang-chang (張傳章) told a news conference in Taipei.
Photo: CNA
PMI figures seek to show the health of the manufacturing industry, with scores above 50 indicating expansion and values below indicating contraction.
Customers were generally upbeat about building inventories after the US presidential election was settled and several drug companies had positive results in their COVID-19 vaccine trials, Chang said.
Some firms, fearing shipping delays after much of Europe and the US introduced partial lockdowns to rein in COVID-19 transmission rates, stockpiled supplies well ahead of the holiday season, Chang said, adding that the annual Singles’ Day shopping blitz also lent support.
The sub-index on new business orders stood at 64.8, dropping 1.1 points from October, while the gauge on industrial production rose 2.8 points to 66.5, the survey showed.
Supply Management Institute in Taiwan (中華採購與供應管理協會) executive director Steve Lai (賴樹鑫) said that the situation is headed toward overheating, or when PMI scores are more than 60 points.
CIER researcher Chen Shin-hui (陳馨蕙) said that concerns over shipping delays contributed to the boom, after shipping companies reconfigured routes to deal with the pandemic.
After the recovery arrived faster than expected, local companies had to vie for containers to deliver their products, Chen said.
The reading on delivery times added 4.1 points from October to 63.5, the survey showed.
The measure on raw material prices gained 6.9 points to 72.5, while the sub-index on unfinished orders added 2.9 points to 59.6, it showed.
Companies hold optimistic outlooks, with the six-month business outlook rising 5.1 points to 63.4, CIER said.
The non-manufacturing index rose 0.4 points to 53.8 — its sixth consecutive month of expansion — although restaurants and hotels continued to struggle, it said.
The situation is likely to improve, as all service-oriented sectors expect business to expand over the next six months, it added.
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