Business sentiment in Taiwan’s export-oriented manufacturing sector improved for the third consecutive month last month, buoyed by growing demand for artificial intelligence (AI) applications and stronger consumer electronics orders, the Taiwan Institute of Economic Research (TIER) said on Thursday.
TIER data showed that the composite index for the manufacturing sector rose 2.52 points from a month earlier to 91.65.
By contrast, the index for the services sector fell 2.88 points to 85.23, while the construction sector index edged up 0.80 points to 97.35, they showed.
Photo: Chiang Ying-ying, AP
The institute attributed the uptick in manufacturing sentiment to a sharp increase in exports of electronic components and information and communications (ICT) devices, which surged 33.8 percent year-on-year last month, prompting more manufacturers to be more upbeat about their operations
However, lingering concerns over US-China trade negotiations and the slow progress of bilateral trade talks between Washington and Taipei continued to weigh on manufacturers’ outlook, the institute said.
As for the decline in the services sector index, the institute said the local stock market’s strong performance — highlighted by a 6.55 percent rise in the benchmark TAIEX — helped boost sentiment among financial firms.
However, the traditional “Ghost Month” period dampened consumer demand for durable goods such as cars, furniture and home appliances, offsetting those gains, it said.
In Taiwan, many people avoid buying durable goods during Ghost Month, which fell between Aug. 23 and Sept. 21 this year, due to longstanding superstitions, it added.
With the end of summer vacation, retail and food-and-beverage sales weakened, further weighing on last month’s composite index, the institute said.
The local housing market also showed signs of consolidation, with property transactions down 3.5 percent from August, it said.
TIER forecast that total home sales for the year would decline by more than 20 percent year-on-year, citing the central bank’s selective credit controls and tighter bank lending.
Uncertainty about the domestic economy due to the Trump administration’s tariff policies is expected to keep many potential home buyers on the sidelines, it added.
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