Taiwanese firms last month turned more conservative about the local economy due to inflationary pressures, with the climate gauge for the manufacturing industry falling to 86.73, the lowest since June 2020, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) said yesterday.
The figure fell from 88.08 a month earlier to post its eight consecutive monthly decline, the Taipei-based think tank told a videoconference, citing the results of its monthly survey.
Only 17.2 percent of the polled manufacturers were optimistic about their business prospects in the coming six months, down from 20.1 percent a month earlier, the institute said.
Photo: Ritchie B. Tongo, EPA-EFE
Companies operating in the fields of plastics, chemicals, synthetic fibers, steel and metal, glass, and information technology equipment were more conservative about their business prospects over the period, it said.
About 70 percent of steelmakers expressed pessimism, citing weaker market demand and a correction in raw material prices.
The survey found that about 60 percent of chemical makers were gloomy, as COVID-19 lockdowns in China battered demand, while corrections in oil prices trimmed their profits.
Despite slowing sales of consumer electronics, electronics manufacturers remained upbeat on the back of strong demand for automotive electronics, high-performance computing devices and semiconductors, the institute said.
The depreciation of the New Taiwan dollar against the US dollar also bolstered electronic companies’ sales performance, it added.
However, about 40 percent of the polled electronics manufacturers were conservative about their business outlook over the next six months, citing a shortage of chips, rising inventories and high inflation, the institute said.
The climate gauge for the service sector fell to 95.6 from 97.2 a month earlier, as transportation, logistics and warehousing companies turned conservative for the next six months, the institute said.
Seventy percent of the polled retailers had a neutral outlook for the next six months, due to concerns that high inflation and uncertainty in the global economy would weigh on consumer spending, it said.
Pessimistic sentiment also affected the construction sector, with the business measure falling to 93.12 from 96.61 a month earlier, the institute said.
In contrast, 80 percent of restaurant operators and tourism companies said they were upbeat for the next six months amid a planned easing of border restrictions, the institute said.
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