Taiwan: Manufacturing PMI in October inches up but remains entrenched in contraction territory
November 2, 2015
The manufacturing Purchasing Managers’ Index (PMI), elaborated by Nikkei and Markit, rose from 46.9 in September to 47.8 in October, which marked a five-month high. Despite the increase, this is the sixth consecutive month in which the PMI is below the 50-threshold, which separates contraction from expansion in the manufacturing sector.
According to Nikkei, October’s result came on the back of a less-pronounced contraction in both output and new orders—both contracted at the slowest rate in five months. Companies continued to cut back on input buying while simultaneously continuing with destocking activities as client demand has deteriorated. More importantly, employment eased to a 29-month low in October mainly due to weaker demand. Markit analysts added that, “softer customer demand amid weak economic conditions continued to weigh on the sector’s performance. Consequently, firms were increasingly cautious towards job hiring, raising their staff numbers at the slowest rate for nearly two-and-a-half years.”