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.
Taiwan’s foreign exchange reserves fell below the US$600 billion mark at the end of last month, with the central bank reporting a total of US$596.89 billion — a decline of US$8.6 billion from February — ending a three-month streak of increases. The central bank attributed the drop to a combination of factors such as outflows by foreign institutional investors, currency fluctuations and its own market interventions. “The large-scale outflows disrupted the balance of supply and demand in the foreign exchange market, prompting the central bank to intervene repeatedly by selling US dollars to stabilize the local currency,” Department of Foreign
ENERGY ISSUES: The TSIA urged the government to increase natural gas and helium reserves to reduce the impact of the Middle East war on semiconductor supply stability Chip testing and packaging service provider ASE Technology Holding Co (日月光投控) yesterday said it planned to invest more than NT$100 billion (US$3.15 billion) in building a new advanced chip testing facility in Kaohsiung to keep up with customer demand driven by the artificial intelligence (AI) boom. That would be included in the company’s capital expenditure budget next year, ASE said. There is also room to raise this year’s capital spending budget from a record-high US$7 billion estimated three months ago, it added. ASE would have six factories under construction this year, another record-breaking number, ASE chief operating officer Tien Wu
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
For weeks now, the global tech industry has been waiting for a major artificial intelligence (AI) launch from DeepSeek (深度求索), seen as a benchmark for China’s progress in the fast-moving field. More than a year has passed since the start-up put Chinese AI on the map in early last year with a low-cost chatbot that performed at a similar level to US rivals. However, despite reports and rumors about its imminent release, DeepSeek’s next-generation “V4” model is nowhere in sight. Speculation is also swirling over the geopolitical implications of which computer chips were chosen to train and power the new
RSS