The government’s business climate monitor last month flashed “red,” a quick return to a booming state after cooling a bit in July, as local firms benefited from inventory buildup ahead of new technology product launches, the National Development Council (NDC) said yesterday.
The latest composite score gained 4 points to 39, the best performance in 34 months, as the high sales season for technology products is approaching and demand for artificial intelligence (AI) has remained strong, NDC Economic Department Director Chiu Chiu-ying (邱秋瑩) said.
The uptick is expected to be sustained moving forward, she said.
Photo: CNA
The council uses a five-color spectrum to depict the nation’s economic state with “red” indicating a boom, “green” suggesting steady growth and “blue” signifying a recession. Dual-colors mean the economy is shifting gears to a better or worse state.
The boom came after key economic gauges such as exports, industrial production and overtime gained vigor, the council said.
Taiwan is home to the world’s largest suppliers of electronics used in smartphones, notebook computers, wearables, cars and cloud-based data centers.
Scores of local firms are responsible for making Nvidia’s AI chips, servers and other devices, while many others supply critical components for Apple Inc’s iPhone series, Apple watches and notebook computers.
Their business tends to pick up ahead of the Christmas season.
The index of leading indicators, which aims to project the economic landscape in the next six months, increased 0.43 percent month-on-month to 104.09, the council said.
The sub-indices on imports of semiconductor equipment, new construction floor spaces and local share prices posted upward cyclical movements, it said.
However, readings on business confidence, labor accession rates and money supply gave up some points, it observed.
Better order visibility led local semiconductor firms to increase their purchases of capital equipment from abroad to upgrade their technologies and expand capacity, Chiu said.
The trend would shore up private investment, a critical component of GDP, the official said.
The index of coincident indicators, which reflects the current economic situation, climbed 1.23 percent to 106.47, as seen in advances in electricity use, imports of machinery equipment, overtime hours, as well as revenues for retailers, wholesale operators and restaurants, it said.
Looking ahead, AI applications and high-performance computing are expected to grow more popular, bringing more business opportunities for local firms, who command global leadership positions in terms of technology processes, Chiu said.
That said, Taiwan still needs to watch out for uncertainty linked to the US presidential election in November, trade disputes between major economies and rising geopolitical tensions in the Middle East, the official said.
RUN IT BACK: A succesful first project working with hyperscalers to design chips encouraged MediaTek to start a second project, aiming to hit stride in 2028 MediaTek Inc (聯發科), the world’s biggest smartphone chip supplier, yesterday said it is engaging a second hyperscaler to help design artificial intelligence (AI) accelerators used in data centers following a similar project expected to generate revenue streams soon. The first AI accelerator project is to bring in US$1 billion revenue next year and several billion US dollars more in 2027, MediaTek chief executive officer Rick Tsai (蔡力行) told a virtual investor conference yesterday. The second AI accelerator project is expected to contribute to revenue beginning in 2028, Tsai said. MediaTek yesterday raised its revenue forecast for the global AI accelerator used
TEMPORARY TRUCE: China has made concessions to ease rare earth trade controls, among others, while Washington holds fire on a 100% tariff on all Chinese goods China is effectively suspending implementation of additional export controls on rare earth metals and terminating investigations targeting US companies in the semiconductor supply chain, the White House announced. The White House on Saturday issued a fact sheet outlining some details of the trade pact agreed to earlier in the week by US President Donald Trump and Chinese President Xi Jinping (習近平) that aimed to ease tensions between the world’s two largest economies. Under the deal, China is to issue general licenses valid for exports of rare earths, gallium, germanium, antimony and graphite “for the benefit of US end users and their suppliers
Dutch chipmaker Nexperia BV’s China unit yesterday said that it had established sufficient inventories of finished goods and works-in-progress, and that its supply chain remained secure and stable after its parent halted wafer supplies. The Dutch company suspended supplies of wafers to its Chinese assembly plant a week ago, calling it “a direct consequence of the local management’s recent failure to comply with the agreed contractual payment terms,” Reuters reported on Friday last week. Its China unit called Nexperia’s suspension “unilateral” and “extremely irresponsible,” adding that the Dutch parent’s claim about contractual payment was “misleading and highly deceptive,” according to a statement
Artificial intelligence (AI) giant Nvidia Corp’s most advanced chips would be reserved for US companies and kept out of China and other countries, US President Donald Trump said. During an interview that aired on Sunday on CBS’ 60 Minutes program and in comments to reporters aboard Air Force One, Trump said only US customers should have access to the top-end Blackwell chips offered by Nvidia, the world’s most valuable company by market capitalization. “The most advanced, we will not let anybody have them other than the United States,” he told CBS, echoing remarks made earlier to reporters as he returned to Washington
RSS