The nation’s official manufacturing purchasing managers’ index (PMI) last month shed a marginal 0.2 points to 47.9, dragged by soft new business orders and employment, but companies expressed more confidence about their business outlook, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
It was the 13th consecutive month the PMI remained in contraction mode, although most sectors reported that business improved, the Taipei-based think tank said.
“The latest PMI stayed on a course of stabilization, but a concrete and even pickup will have to wait until global consumer markets recover,” CIER vice president Chen Shin-horng (陳信宏) said.
Photo: EPA-EFE
PMI data seek to measure the health of the manufacturing industry with values of 50 and higher suggesting expansion and points below the neutral threshold indicating contraction.
The reading on new business orders lost 2 points to 46.9, although the gauge on order visibility climbed above the 50-point mark for almost all sectors except for suppliers of raw materials, the institute’s monthly report showed.
The reading on industrial production fell 4.2 points to 47.3, while that on employment increased 1.2 points to 48.9, consistent with it being the slow season for technology products, it said.
The inventory measure rose 2.4 points to 46.9, while the customers’ inventory reading gained 2.4 points to 42.9, both reflecting a conservative approach, the CIER report showed.
Prudence is necessary and wise in light of rising raw material prices, which pushed the price index to 58.3, up 3 points from one month earlier, the report found.
Despite the lackluster showing last month, companies are looking at improving business ahead as the six-month business outlook increased 2.4 points to 56.4, the fastest expansion since April 2022, with all sectors expressing optimism, CIER said.
Local tech firms are benefiting from booming demand for artificial intelligence applications and services, Chen said.
CIER also reported that non-manufacturing companies continued to enjoy sturdy business even though the holiday effect has faded, with the non-manufacturing index rising 1.2 points to 53.5.
Most service providers are upbeat about business moving forward, encouraged by better GDP growth this year, the institute said.
The S&P Global Taiwan PMI reached similar findings with a value of 49.3 las month, compared with 48.6 the previous month, with both output and new orders declining at modest rates.
“Although the latest data showed a continued deterioration in the overall operating condition, it provided further signs that the Taiwanese manufacturing sector is moving closer to stabilization,” S&P Global Market Intelligence economic director Paul Smith said in a statement. “Signs of price and supply stability are helping support a more optimistic outlook.”
However, demand for goods remains weak — from both domestic and international sources — leading firms to cut purchasing activity and exercise caution in dealing with inventory, Smith said.
Companies demonstrated a preference wherever possible to utilize inventories and fulfill orders from warehouses
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
DOMESTIC SUPPLY: The probe comes as Donald Trump has called for the repeal of the US$52.7 billion CHIPS and Science Act, which the US Congress passed in 2022 The Office of the US Trade Representative is to hold a hearing tomorrow into older Chinese-made “legacy” semiconductors that could heap more US tariffs on chips from China that power everyday goods from cars to washing machines to telecoms equipment. The probe, which began during former US president Joe Biden’s tenure in December last year, aims to protect US and other semiconductor producers from China’s massive state-driven buildup of domestic chip supply. A 50 percent US tariff on Chinese semiconductors began on Jan. 1. Legacy chips use older manufacturing processes introduced more than a decade ago and are often far simpler than
STILL HOPEFUL: Delayed payment of NT$5.35 billion from an Indian server client sent its earnings plunging last year, but the firm expects a gradual pickup ahead Asustek Computer Inc (華碩), the world’s No. 5 PC vendor, yesterday reported an 87 percent slump in net profit for last year, dragged by a massive overdue payment from an Indian cloud service provider. The Indian customer has delayed payment totaling NT$5.35 billion (US$162.7 million), Asustek chief financial officer Nick Wu (吳長榮) told an online earnings conference. Asustek shipped servers to India between April and June last year. The customer told Asustek that it is launching multiple fundraising projects and expected to repay the debt in the short term, Wu said. The Indian customer accounted for less than 10 percent to Asustek’s
Gasoline and diesel prices this week are to decrease NT$0.5 and NT$1 per liter respectively as international crude prices continued to fall last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC and Formosa stations are to decrease to NT$29.2, NT$30.7 and NT$32.7 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while premium diesel is to cost NT$27.9 per liter at CPC stations and NT$27.7 at Formosa pumps, the companies said in separate statements. Global crude oil prices dropped last week after the eight OPEC+ members said they would
RSS