Jul 27, 2018 Sports Comments Off on Taiwan economy flashes yellow-blue light in June
Taipei, Taiwan's economy has shown signs of weakening as an index gauging local economic fundamentals flashed a yellow-blue light for June, indicating sluggish growth, the National Development Council (NCD) said Friday.
In a statement, the NDC said the composite index of monitoring indicators for June fell seven points to 22, the lowest level since January, when the index stood at 20.
The seven-point fall was the steepest since August 2013, when the NDC began using the current version of the model used to calculate the index.
The fall in the index made the local economy flash a yellow-blue light, which represents a range between 17 and 22, ending a four-month streak of a green light.
The NDC uses a five-color system to gauge the country's economic performance, with blue indicating economic recession, yellow-blue representing economic sluggishness, green denoting stable growth, yellow-red referring to a warming economy, and red pointing to economic overheating.
Wu Ming-hui (???), head of the NDC's Department of Economic Development, said that a fall in industrial production and exports served as the reason behind the decline in the index.
Wu said the drop in industrial production and exports largely reflected weaker outbound sales posted by the electronics sector in the second quarter, a traditional peak season for the industry.
She said the semiconductor business experienced inventory adjustments at a time of weakening demand for mining devices used in cryptocurrency transactions.
The fall in the index showed that the strength of the local economic recovery has not been solid enough, she added.
However, Wu said that as the electronics sector is in its peak season in the third quarter, she expects that a fall in the composite index of monitoring indicators in June will soon be reversed.
In addition to industrial production and exports, all of the other factors in the index -- money supply, stock prices, employment in the non-farm sector, machinery and electrical equipment imports, revenue posted by the wholesale, retail and food beverage sectors, sales recorded by the manufacturing sector, and business sentiment in the manufacturing sector -- dropped in June.
However, stock prices, exports, machinery and electrical imports, and business sentiment in the manufacturing sector flashed a healthy green light, while the other factors flashed a yellow-blue light in June, the NDC said.
In June, the leading indicator, which is used to gauge the economic outlook for the coming six-month period fell 0.34 percent to 99.88, marking the seventh straight month for the indicator to move lower, the NDC said.
But Wu said the fall in the leading indicator in the past seven months was minor, with an accumulated 1.71 percent fall, so she was not worried about the decline.
Source: Focus Taiwan News Channel
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