IHS Markit’s Taiwan manufacturing purchasing managers’ index (PMI) last month climbed to a decade-high of 59.4 as firms reported a sharp increase in new business and output amid soaring input costs and worsening supply delays.
PMI figures seek to show the health of the manufacturing industry, with scores above 50 indicating expansion and values below indicating contraction.
Last month’s score rose from 56.9 in November, signaling the strongest pickup in operating conditions since January 2011, the monthly survey showed on Monday.
Photo: Sam Yeh, AFP
“Taiwan’s manufacturing sector had a strong end to last year, with firms registering the steepest upturns in output and new orders for nearly a decade,” IHS Markit economics associate director Annabel Fiddes said in a statement.
Rising inflows of new work prompted firms to expand purchasing activity at a rapid rate, Fiddes said.
The new business gauge expanded at the sharpest rate in a decade, with firms citing a further rebound in sales as the effects of the COVID-19 pandemic continued to unwind, she said.
Growth in new exports also hit a near-decade high, as companies reported stronger demand in many of the nation’s major external markets, the survey found.
The data also pointed to renewed increases in pre and post-production items, as firms stockpiled goods amid strained supply chains and greater customer demand.
Although firms registered steeper increases in production and sales, they adopted a cautious approach to staffing levels, which drove a rapid increase in work backlogs, IHS Markit said, adding that backlogs increased at the sharpest rate since February 2018.
Stock shortages, limited capacity and port delays led to a substantial lengthening of suppliers’ delivery times, it said.
Supply shortages and delays contributed to a substantial rise in input costs, which led to a marked increase in output charges, it added.
Average input prices rose at the steepest rate since December 2016, driven by increased raw material prices and stock shortages, IHS Markit said.
To help maintain profit margins, firms passed on higher operating expenses to customers by raising selling prices at the quickest pace since March 2011, it said.
Encouragingly, firms reported greater demand at home and abroad, with growth in export sales rising to its highest level in nearly 10 years, Fiddes said.
Expectations that global demand conditions will continue to improve over the months ahead boosted business confidence to a 33-month high, she said.
However, supply chain disruptions, rising costs and the resurgence of COVID-19 infections in several export markets could weigh on growth, she added.
COMPETITION: AMD, Intel and Qualcomm are unveiling new laptop and desktop parts in Las Vegas, arguing their technologies provide the best performance for AI workloads Advanced Micro Devices Inc (AMD), the second-biggest maker of computer processors, said its chips are to be used by Dell Technologies Inc for the first time in PCs sold to businesses. The chipmaker unveiled new processors it says would make AMD-based PCs the best at running artificial intelligence (AI) software. Dell has decided to use the chips in some of its computers aimed at business customers, AMD executives said at CES in Las Vegas on Monday. Dell’s embrace of AMD for corporate PCs — it already uses the chipmaker for consumer devices — is another blow for Intel Corp as the company
STIMULUS PLANS: An official said that China would increase funding from special treasury bonds and expand another program focused on key strategic sectors China is to sharply increase funding from ultra-long treasury bonds this year to spur business investment and consumer-boosting initiatives, a state planner official told a news conference yesterday, as Beijing cranks up fiscal stimulus to revitalize its faltering economy. Special treasury bonds would be used to fund large-scale equipment upgrades and consumer goods trade-ins, said Yuan Da (袁達), deputy secretary-general of the Chinese National Development and Reform Commission. “The size of ultra-long special government bond funds will be sharply increased this year to intensify and expand the implementation of the two new initiatives,” Yuan said. Under the program launched last year, consumers can
TECH PULL: Electronics heavyweights also attracted strong buying ahead of the CES, analysts said. Meanwhile, Asian markets were mixed amid Trump’s incoming presidency Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares yesterday closed at a new high in the wake of a rally among tech stocks on Wall Street on Friday, moving the TAIEX sharply higher by more than 600 points. TSMC, the most heavily weighted stock in the TAIEX, rose 4.65 percent to close at a new high of NT$1,125, boosting its market value to NT$29.17 trillion (US$888 billion) and contributing about 400 points to the TAIEX’s rise. The TAIEX ended up 639.41 points, or 2.79 percent, at 23,547.71. Turnover totaled NT$406.478 billion, Taiwan Stock Exchange data showed. The surge in TSMC follows a positive performance
FUTURE TECH: Nvidia CEO Jensen Huang would give the keynote speech at this year’s Consumer Electronics Show, which is also expected to highlight autonomous vehicles Gadgets, robots and vehicles imbued with artificial intelligence (AI) would once again vie for attention at the Consumer Electronics Show (CES) this week, as vendors behind the scenes would seek ways to deal with tariffs threatened by US president-elect Donald Trump. The annual Consumer Electronics Show opens formally in Las Vegas tomorrow, but preceding days are packed with product announcements. AI would be a major theme of the show, along with autonomous vehicles ranging from tractors and boats to lawn mowers and golf club trollies. “Everybody is going to be talking about AI,” Creative Strategies Inc analyst Carolina Milanesi said. “From fridges to ovens
RSS