The government’s business climate monitor last month turned “yellow-red” from “red,” indicating that Taiwan’s economy continued to expand, although some barometers slowed because of fewer working days, the National Development Council (NDC) said yesterday.
The composite score shed 4 points to 34, but both indices of leading indicators and coincident indicators moved up, affirming steady growth, the council said.
“The slowdown had much to do with the Lunar New Year holiday and the government is closely watching for any shift in economic trend,” NDC Department of Economic Development Deputy Director Chen Mei-chu (陳美菊) told a news conference.
Photo: CNA
The council uses a five-color spectrum to describe the nation’s economic state, with “red” signifying a boom, “green” indicating stable growth and “blue” suggesting sluggishness. A dual-color reading means the economy is shifting gears to a better or worse state.
The yellow-red signal came after exports gained momentum, but manufacturing sales, as well as wholesale and retail revenues, were subdued, the council said.
Tech firms remained busy to meet demand from global customers for electronics used in artificial intelligence (AI), but non-tech firms’ operations slowed in observance of the Lunar New Year after frontloading activity ahead of expectations of tariff hikes subsided, Chen said.
The index of leading indicators, which seeks to project the economic scene in the coming six months, increased 0.32 percent, up for a second straight month, as export orders, imports of semiconductor equipment and manufacturing business confidence displayed positive momentum, the council said.
Companies received more orders for information and communications technology products, as AI applications widened, which is favorable to exports, Chen said.
Likewise, the index of coincident indicators, which reflects the current economic situation, edged up 0.2 percent to 104.28, as industrial production, overtime hours and imports of machinery equipment improved from one month earlier, the council said.
In related developments, Taiwanese grew slightly more confident about spending this month, judging by an uptick of 0.05 points in the consumer confidence index to 72.59, a monthly survey by National Central University (NCU) released yesterday showed.
Specifically, people turn mildly more optimistic about Taiwan’s economic outlook, household income, the job market and purchases of durable goods, noticeably real estate, it found.
The positive-leaning sentiment came despite US President Donald Trump’s threat to impose tariffs on semiconductors, which bodes ill for Taiwanese chipmakers, NCU economics professor Dachrahn Wu (吳大任) said.
However, people expressed concern over the consumer price trend amid fears that the electricity prices might rise later this year after the legislature canceled a budget to aid lossmaking Taiwan Power Co (台電), Wu said.
Electricity price hikes would fuel inflation, he added.
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