Jun 01, 2017 Medical Comments Off on Manufacturing activity remains in expansion mode
Taipei--Taiwan's manufacturing activity remained healthy in May; while the purchasing managers index (PMI) fell from a month earlier, it still stood above the 50 point threshold, pointing to expansion, the Chung-Hua Institution for Economic Research (CIER) said Thursday.
Data from CIER, one of the leading economic think tanks in Taiwan, showed that the manufacturing sector's PMI for May fell 2.3 points from a month earlier to 58.7, but that still put the sector in expansion mode for the 15th consecutive month.
At the same time, the non-manufacturing index (NMI) for the service sector also trended lower in April, dropping 0.9 points from April to 55.4 in May, placing the sector in expansion mode for three months in a row, the data indicated.
Wu Chung-shu (???), president of CIER, said that the fall in the May PMI reflected a slow season in the manufacturing sector, adding that the expansion in both PMI and NMI continued to show an improvement in economic climate at home and abroad.
PMI and NMI readings above 50 indicate expansion, while a reading below 50 represents a contraction.
Wu said that CIER remained cautiously optimistic about Taiwan's economy for the second half of this year, but added that due to a relatively high comparison base over the same period of last year, growth could be moderating quarter by quarter in the second half.
CIER is one of several local think tanks to raise its forecast for Taiwan's gross domestic product (GDP) growth in 2017 to above 2 percent, compared with a 1.5 percent increase seen in 2016.
Wu said that the market has been watching closely whether Apple Inc. will launch the next generation iPhones in September as scheduled and how consumers will respond to the new devices.
Taiwanese suppliers to Apple account for about 40 percent of the combined market capitalization of the local main board and the over-the-counter market.
Among the PMI's five major criteria, the sub-indexes for employment and supplier deliveries rose 0.4 points and 0.6 points, respectively, from a month earlier to 60.4 and 60.3 in May.
The sub-indexes for new orders, production and inventories, however, fell 4.9, 5.2 and 2.7 points, respectively, month-on-month to 57.3, 60.0 and 55.4 in May.
Among the six industries making up the manufacturing sector in the CIER model, only the sub-index for food/textiles moved higher in May, while the sub-indexes for electronics/optoelectronics, chemicals/biotech, infrastructure/raw materials, electricity/machinery, and transportation moved lower, the think tank said.
As for the NMI, two sub-indexes for employment and inventories rose 1.1 and 0.1 points from April, respectively, to 54.2 and 54.7 in May, while two other sub-indexes for production and new orders fell 3.6 and 1.1 points to 54.8 and 57.9, the think tank added.
Source: Focus Taiwan News Channel