The climate gauge for the nation’s manufacturing sector in September remained “yellow-red” for the fifth consecutive month, reflecting fast growth, even though port congestion and supply chain disruptions posed uncertainty and drove up operational costs, the Taiwan Institute of Economic Research (TIER, 台經院) said yesterday.
The composite index for the manufacturing sector fell 0.21 points to 16.27 from August, as power rationing and emission restrictions in China slightly weighed on input activity, but the index remained just inside the “yellow-red” range of 16 to 18.5 points, the Taipei-based institute said.
EVERGRANDE WOES
Photo: Chen Rou-chen, Taipei Times
While cash woes plaguing Chinese property developer China Evergrande Group (恆大集團) also dampened sentiment, share prices of electronics, machinery equipment and telecommunication companies picked up, lending support to the overall score, it said.
The institute uses a five-color system to gauge manufacturing activity, with “blue” suggesting recession, “yellow-blue” a slowdown, “green” stability, “yellow-red” fast growth and “red” overheating.
It was the seventh month this year that the manufacturing sector reported a yellow-red reading, the institute said.
Among the five components in the composite index, the sub-index on the operating environment gained 0.38 points, while selling prices were flat, as the peak season might be over for some sectors with correction pressure building, it said.
The input measure lost 0.29 points and the cost tracker shed 0.01 points, it added.
The reading for industries supplying essential goods, such as textile products, was yellow-red, although lockdowns in Vietnam caused supply chain disruptions, it found.
Most Taiwanese textile companies operate manufacturing facilities in Vietnam to save on production costs.
Strong exports pushed up demand for cardboard boxes, causing their prices to increase, the institute said.
The measure also turned yellow-red for manufacturers of petrochemical and plastic products, supported by soaring crude and oil product prices, it said.
However, container shortages and port bottlenecks abroad have delayed their input schedule, it added.
Base metal suppliers reported double-digit percentage growth in business as they continued to benefit from increasing infrastructure spending in the US and Europe, the institute said, adding that machinery equipment vendors were less impressive, reporting steady sales.
Business at electronic component providers remained robust on the back of new product launches and insatiable demand for 5G technology and Internet of Things applications, the institute said.
PENT-UP DEMAND
Auto parts suppliers reported price hikes amid pent-up demand for vehicles, but port congestion and a global chip shortage stretched delivery times, causing the vehicle market in China to slow down, which has turned the reading for related sectors in Taiwan to yellow-blue, it said.
GROWING OWINGS: While Luxembourg and China swapped the top three spots, the US continued to be the largest exposure for Taiwan for the 41st consecutive quarter The US remained the largest debtor nation to Taiwan’s banking sector for the 41st consecutive quarter at the end of September, after local banks’ exposure to the US market rose more than 2 percent from three months earlier, the central bank said. Exposure to the US increased to US$198.896 billion, up US$4.026 billion, or 2.07 percent, from US$194.87 billion in the previous quarter, data released by the central bank showed on Friday. Of the increase, about US$1.4 billion came from banks’ investments in securitized products and interbank loans in the US, while another US$2.6 billion stemmed from trust assets, including mutual funds,
AI TALENT: No financial details were released about the deal, in which top Groq executives, including its CEO, would join Nvidia to help advance the technology Nvidia Corp has agreed to a licensing deal with artificial intelligence (AI) start-up Groq, furthering its investments in companies connected to the AI boom and gaining the right to add a new type of technology to its products. The world’s largest publicly traded company has paid for the right to use Groq’s technology and is to integrate its chip design into future products. Some of the start-up’s executives are leaving to join Nvidia to help with that effort, the companies said. Groq would continue as an independent company with a new chief executive, it said on Wednesday in a post on its Web
Even as the US is embarked on a bitter rivalry with China over the deployment of artificial intelligence (AI), Chinese technology is quietly making inroads into the US market. Despite considerable geopolitical tensions, Chinese open-source AI models are winning over a growing number of programmers and companies in the US. These are different from the closed generative AI models that have become household names — ChatGPT-maker OpenAI or Google’s Gemini — whose inner workings are fiercely protected. In contrast, “open” models offered by many Chinese rivals, from Alibaba (阿里巴巴) to DeepSeek (深度求索), allow programmers to customize parts of the software to suit their
JOINT EFFORTS: MediaTek would partner with Denso to develop custom chips to support the car-part specialist company’s driver-assist systems in an expanding market MediaTek Inc (聯發科), the world’s largest mobile phone chip designer, yesterday said it is working closely with Japan’s Denso Corp to build a custom automotive system-on-chip (SoC) solution tailored for advanced driver-assistance systems and cockpit systems, adding another customer to its new application-specific IC (ASIC) business. This effort merges Denso’s automotive-grade safety expertise and deep vehicle integration with MediaTek’s technologies cultivated through the development of Media- Tek’s Dimensity AX, leveraging efficient, high-performance SoCs and artificial intelligence (AI) capabilities to offer a scalable, production-ready platform for next-generation driver assistance, the company said in a statement yesterday. “Through this collaboration, we are bringing two
RSS