The nation’s purchasing managers index (PMI) rose for the sixth consecutive month to 55 points last month from 53.8 a month earlier — the strongest reading since last March, an HSBC survey showed yesterday.
The composite index, which gauges the health of the manufacturing sector, signaled a “robust expansion” of the sector, the bank said in a statement.
A score above 50 indicates an improvement in business conditions, while anything below 50 indicates worsening conditions.
“Taiwan’s economy continues to stage an impressive rebound, fuelled significantly by rising export orders. Most encouragingly, the employment component of the HSBC PMI index has tracked above 50 for a second month in a row, signalling a stabilization of the labour market and domestic demand,” Frederic Neumann, a senior Asian economist at HSBC, said in the statement.
“Overall, Taiwan’s economy should expand by a robust sequential pace in the third quarter, although in annual terms output is still likely to be down,” he said.
The nation’s new orders index jumped to 57.8 last month from 49.8 in March, which reflected better macroeconomic conditions that have triggered a rise in demand and domestic manufacturing, the bank said.
Although the output growth index showed little movement at 60.5 last month compared with 60.7 in July, the speed of recovery so far this year is exceptional considering the severe retrenchment seen in the second half of last year, the bank said.
Despite markedly increased levels of production, local manufacturers continued to experience both rising work backlogs and dwindling stocks of finished goods.
Urgent orders have eaten into stocks, but insufficient production was the primary reason for work backlogs and low stocks, the bank said.
Surveyed manufacturers from the nation’s 300 industries said production capacity had been limited by labor shortages.
The employment level index rose to 52.9 last month as manufacturers sought to boost capacity, the bank said.
Stocks of raw materials for production continued to dwindle last month, but at a rate slower than the previous month.
Suppliers’ delivery times worsened as a result of a shortage of stocks at vendors, with input prices rising substantially in August and at a markedly higher rate than in July, the survey showed.
CHANGE OF FORTUNES: Concern over a pricey valuation and the risk of tighter US curbs on chip sales to China have poured cold water on TSMC’s bullish momentum Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares fell the most in three months yesterday upon trading resumption, joining a global technology rout as investors dramatically soured on the promises of artificial intelligence (AI). The shares declined 5.62 percent to close at NT$924 in Taipei, dragging down the benchmark TAIEX, which fell 3.29 percent to 22,119.21 points amid a technical correction, Taiwan Stock Exchange data showed. Other chip stocks also fell, with ASE Technology Holding Co (日月光投控) plunging 9.86 percent, MediaTek Inc (聯發科) dropping 2.35 percent, Realtek Semiconductor Corp (瑞昱) falling 1.33 percent and United Microelectronics Corp (聯電) retreating 1.17 percent, while Apple
Taipei is today suspending work, classes and its US$2.4 trillion stock market as Typhoon Gaemi approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed income trading, statements from its stock and currency exchanges said. Authorities had yesterday issued a warning that the storm could affect people on land and canceled some ship crossings and domestic flights. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) expects its local chipmaking fabs to maintain normal production, the company said in an e-mailed statement. The main chipmaker for Apple Inc and Nvidia Corp said it has activated routine typhoon alert
GROWTH: TSMC increased its projected revenue growth for this year to more than 25 percent, citing stronger-than-expected demand for AI devices and smartphones The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) yesterday raised its forecast for Taiwan’s GDP growth this year from 3.29 percent to 3.85 percent, as exports and private investment recovered faster than it predicted three months ago. The Taipei-based think tank also expects that Taiwan would see a 8.19 percent increase in exports this year, better than the 7.55 percent it projected in April, as US technology giants spent more money on artificial intelligence (AI) infrastructure and development. “There will be more AI servers going forward, but it remains to be seen if the momentum would extend to personal computers, smartphones and
Odd lot trades of contract chipmaker Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) shares surged on Friday, although the stock faced headwinds, tumbling more than 5 percent in the session, the Taiwan Stock Exchange (TWSE) said. The volume of odd lot trades of TSMC shares totaled about 9.84 million shares on Friday, up sharply by about 400 percent from Tuesday, in a session before the local stock market closed due to Typhoon Gaemi on Wednesday and Thursday, the TWSE added. Stocks in Taiwan are usually bought or sold in lots of 1,000 shares. The nation lifted a ban on odd lots during regular