Taiwan: Manufacturing PMI jumps in December
January 3, 2017
In December, manufacturing activity in Taiwan registered a seventh consecutive month of improving conditions and the sharpest increase since April 2011. The Manufacturing Purchasing Managers’ Index (PMI), reported by Nikkei and IHS Markit, jumped from 54.7 in November to 56.2 in December, moving further above the 50-point threshold that separates expansion from contraction in the sector.
Manufacturing activity continued to perform solidly at the end of 2016 on the back of stronger production and total new work, the latter of which was supported by faster growth in new exports. Due to rising volumes of new orders, Taiwanese goods producers increased their purchasing activity substantially again in December. In terms of price developments, pressures picked up, causing goods producers to raise their prices as well.
However, IHS Markit noted that, “employment was also a bright spot in the latest survey, with the rate of job creation picking up to its strongest since April 2011 in December. Nonetheless, capacity pressures persisted, with unfinished workloads rising at the steepest rate since the start of 2011. This suggests that firms may ramp up production and staff numbers further at the start of 2017, particularly as companies continue to raise their purchasing activity.”
Author: Ricardo Aceves, Senior Economist