Taiwan: Manufacturing PMI rises further in February
The manufacturing Purchasing Managers’ Index (PMI), released by IHS Markit, rose from 60.2 in January to 60.4 in February, marking the best reading since April 2010. As a result, the PMI moved further above the critical 50-threshold separating improving and deteriorating operating conditions.
February’s upturn was spearheaded by stronger output growth, which was driven by rapid increases in new orders and new exports. Moreover, employment growth was solid. Operating price pressures were elevated, linked to stock shortages and higher transport costs, with firms passing on part of this burden by raising output prices. Moreover, supply chain delays were the worst on record in February.
Annabel Fiddes, associate director at IHS Markit, painted a nuanced picture:
“The steep increases in new work and purchasing activity suggest that activity across the sector will continue to expand strongly in the months ahead. Among the many positives from the latest survey, there remain some areas of concern that could weigh on performance, however. Supply chain delays remained severe due to limited stock at suppliers and container shortages. If this persists, it could limit production capabilities and delay the delivery of products to clients. At the same time, greater demand for inputs and limited supply has added further upwards pressure on prices, with input cost inflation close to a decade-high.”