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Taiwan PMI November 2020

Taiwan: Manufacturing PMI points to another solid expansion in activity in November

The manufacturing Purchasing Managers’ Index (PMI), released by IHS Markit, jumped to 56.9 in November from 55.1 in October, marking the joint-strongest reading since April 2011. As a result, the PMI rose further above the critical 50-threshold, hinting at steadily improving operating conditions in the Taiwanese manufacturing sector at the end of 2020.

November’s upturn result was chiefly driven by stronger new business and production growth amid the waning effects of the pandemic. Manufacturing output increased at the strongest pace since July 2014 and new orders expanded at the fastest rate since January 2011, as market conditions continued to improve amid firmer client demand both at home and overseas. On top of that, business sentiment rose to a 10-month high and backlogs of work also jumped, although the rate of job creation remained only modest in November. Lastly, input costs soared on supply shortages and rising demand, hitting an over two-year high.

Commenting on Taiwan’s labor market conditions, Annabel Fiddes, associate director at IHS Markit, said:

“Taiwanese manufacturers continued to bounce back from the Covid-19 related downturn in November […] However, firms remained cautious in terms of employment, as the pandemic situation remains uncertain overseas, and many countries are still under restrictions to stem the spread of the virus. The modest jobs gain also coincided with a sharp rise in costs, as companies struggled to get hold of inputs, which could also weigh on hiring decisions and operating margins in the months ahead.”

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