Taiwan PMI December 2019

Taiwan

Taiwan: Manufacturing PMI ends the year on a positive note

January 2, 2020

The manufacturing Purchasing Managers’ Index (PMI), reported by IHS Markit, rose to 50.8 in December from 49.8 in November, thus moving above the 50-threshold and signaling the first improvement in operating conditions in over a year.

The improvement came amid an uptick in the amount of new work received by manufacturers, ending a 15-month run of contraction. Furthermore, strengthening domestic sales, a stabilization of output and a renewed rise in backlogs of work supported the overall result. Regarding prices, output prices fell again in December as firms sought to remain competitive, even though a sharp increase in input costs put pressure on operating margins.

Despite the more positive domestic picture, Annabel Fiddes, principal economist at IHS Markit, highlighted the gloomy external panorama:

"The continued decline in export sales amid ongoing trade tensions remains a particular source of concern for the export-orientated economy. Unless we see a broad-based pick up in global demand alongside the uptick in domestic orders, the sector may struggle to maintain growth momentum at the start of 2020."

FocusEconomics Consensus Forecast panelists project fixed investment to expand 3.0% in 2020, which is down 0.1 percentage points from last month’s forecast. For 2021, participants see fixed investment increasing 3.1%.


Author:, Economist

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Taiwan PMI December 2019

Note: Taiwan Purchasing Managers’ Index (PMI). Readings above 50 indicate an overall increase compared to the previous month, and below 50 an overall decrease.
Source: IHS Markit.


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