Taiwan’s official manufacturing purchasing managers’ index (PMI) was 48.1 last month, virtually unchanged from January’s 48, as all sectors reported a decline in business mainly due to holiday disruptions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
However, firms were mostly confident about their business prospects, indicating that a rebound is around the corner, the institute said.
“The latest PMI showing is not bad given the significant drop in working days caused by the week-long Lunar New Year holiday in February,” CIER president Yeh Chun-hsien (葉俊顯) said.
Photo: Hsu Tzu-ling, Taipei Times
PMI data aim to gauge the health of the manufacturing industry, with scores of more than 50 indicating expansion and those lower than the threshold suggesting a contraction.
The barometer held steady, which was encouraging and had to do with expectations that business would pick up, Yeh said.
Order visibility might become clearer and boost purchasing activity from this month, he said.
Taiwan Semiconductor Manufacturing Co’s (台積電) recent opening of a wafer fab in Japan reflects an upturn in chip demand and would benefit the companies in its supply chain, he said.
At the same time, the six-month business outlook subindex gained 7.8 points to 54, returning to growth for the first time in 21 months, a sign that inventory adjustments for tech firms are close to ending, he said.
The surge in global demand for artificial intelligence (AI) is fueling local firms that supply AI severs, graphics processing units and other critical components, he added.
Holiday disruptions accounted for month-on-month declines in new orders, delivery time, employment, inventory and clients’ inventory, while industrial output and raw material prices increased, as firms prepared for improved business, the institute’s monthly report said.
The non-manufacturing index shed 1.2 points to 52.3 last month, because some sectors started to lose confidence as Taiwanese prefer to travel overseas and the number of inbound tourists is not growing fast enough, CIER said.
In particular, hotels and restaurants no longer held positive views about their business prospects due to the arrival of the low season and a high comparison base last year, it said.
However, financial institutions, property brokers and telecoms became optimistic, partly due to rallies on the TAIEX, it said.
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