The S&P Taiwan Manufacturing Purchasing Managers’ Index (PMI) last month rose to 49.0, from 44.3 in January, as the worst of inventory adjustments likely ended, as evidenced by improving demand from China following the lifting of its strict COVID-19 curbs.
The PMI pointed to a less serious deterioration in the operating conditions of manufacturers in light of subdued declines in output, new orders and input buying, S&P Global Market Intelligence said on Wednesday.
“The upward movement in the indices reflected improvements in demand at some firms, partly due to eased COVID-19 restrictions in China, and adds to hopes that the worst of the current downturn is now behind us,” company associate director Annabel Fiddes said in a statement.
Photo: Ritchie B. Tongo, EPA-EFE
PMI data aim to gauge the health of the manufacturing industry, with scores of 50 and higher indicating business expansion and values lower than that suggesting contraction.
Retreats in output and new orders subsided, and input purchases weakened at a softer pace, while supply chain pressures fell markedly from a year earlier, Fiddes said.
Production declined at the slowest pace in 10 months, while a retreat in total new business slowed from the beginning of the year, the report said.
Employment fell for the second month in a row, albeit only slightly, it said.
New orders fell at the slowest rate since May last year and only marginally, it added.
A downturn in new export business eased notably, with foreign sales shrinking only slightly, the report said.
Supply chain stress subsided and is close to stabilizing, with businesses reporting the slowest increase in delivery times in 43 months, it said.
Customer demand remained tepid, but some companies reported sales increases, especially from customers in China, the report said.
Still, companies were cautious about inventory management, but cost pressures increased in light of sharply rising input costs, the report added.
Nevertheless, businesses reduced selling prices to boost sales, it said.
“There still needs to be a meaningful increase in global demand to support a recovery in Taiwan,” Fiddes said.
Companies were not as downbeat in their business outlook for the year ahead as they were in January, but they still remain negative, she said, adding that a murky global economic outlook and stubborn cost pressures would continue to weigh on output projections.
SEEKING CLARITY: Washington should not adopt measures that create uncertainties for ‘existing semiconductor investments,’ TSMC said referring to its US$165 billion in the US Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) told the US that any future tariffs on Taiwanese semiconductors could reduce demand for chips and derail its pledge to increase its investment in Arizona. “New import restrictions could jeopardize current US leadership in the competitive technology industry and create uncertainties for many committed semiconductor capital projects in the US, including TSMC Arizona’s significant investment plan in Phoenix,” the chipmaker wrote in a letter to the US Department of Commerce. TSMC issued the warning in response to a solicitation for comments by the department on a possible tariff on semiconductor imports by US President Donald Trump’s
‘FAILED EXPORT CONTROLS’: Jensen Huang said that Washington should maximize the speed of AI diffusion, because not doing so would give competitors an advantage Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) yesterday criticized the US government’s restrictions on exports of artificial intelligence (AI) chips to China, saying that the policy was a failure and would only spur China to accelerate AI development. The export controls gave China the spirit, motivation and government support to accelerate AI development, Huang told reporters at the Computex trade show in Taipei. The competition in China is already intense, given its strong software capabilities, extensive technology ecosystems and work efficiency, he said. “All in all, the export controls were a failure. The facts would suggest it,” he said. “The US
The government has launched a three-pronged strategy to attract local and international talent, aiming to position Taiwan as a new global hub following Nvidia Corp’s announcement that it has chosen Taipei as the site of its Taiwan headquarters. Nvidia cofounder and CEO Jensen Huang (黃仁勳) on Monday last week announced during his keynote speech at the Computex trade show in Taipei that the Nvidia Constellation, the company’s planned Taiwan headquarters, would be located in the Beitou-Shilin Technology Park (北投士林科技園區) in Taipei. Huang’s decision to establish a base in Taiwan is “primarily due to Taiwan’s talent pool and its strength in the semiconductor
French President Emmanuel Macron has expressed gratitude to Hon Hai Precision Industry Co (鴻海精密) for its plan to invest approximately 250 million euros (US$278 million) in a joint venture in France focused on the semiconductor and space industries. On his official X account on Tuesday, Macron thanked Hon Hai, also known globally as Foxconn Technology Group (富士康科技集團), for its investment projects announced at Choose France, a flagship economic summit held on Monday to attract foreign investment. In the post, Macron included a GIF displaying the national flag of the Republic of China (Taiwan), as he did for other foreign investors, including China-based