Taiwan: Manufacturing PMI dips in October
November 1, 2019
The manufacturing Purchasing Managers’ Index (PMI), reported by IHS Markit, dipped to 49.8 in October from 50.0 in September, once again coming below the 50.0-threshold that separates contraction from expansion after briefly climbing above it in September for the first time in a year.
The amount of new work received by manufacturers decreased in October at a faster pace than in September, amid a steeper drop in new export sales, partly due to the ongoing U.S.-China trade war. Despite the decrease in new work, however, total output increased in October for the first time since August 2018, although the rate of increase was only marginal.
In terms of employment, headcounts rose in October at a slower pace than in September. Still, the increase in employees helped outstanding business levels drop at the fastest pace since July. Looking at stocking levels, firms reduced pre- and post-production stocks in October at faster paces than in September, while average supplier delivery times lengthened at a faster pace than in September.
Regarding prices, input inflation returned in October for the first time in seven months, although output charges continued to decline. Finally, businesses held a largely pessimistic view about the one-year outlook for output in October.
Author: Edward Gardner, Economist