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Taiwan PMI March 2024

Taiwan: Manufacturing PMI rises in March

The S&P Global Taiwan Manufacturing Purchasing Managers’ Index (PMI) rose to 49.3 in March from 48.6 in February. As a result, the index remained below the 50.0 no-change threshold, but signaled a softer deterioration in manufacturing sector operating conditions compared to the previous month.

The slight improvement in the PMI was driven by slower declines in output and new orders compared to February. The reduction in production was the weakest since March 2023, and new orders decreased at the softest rate for 22 months. However, there was a further drop in new export orders, particularly from key markets like Mainland China, Europe, and the United States. This led companies to reduce their purchasing activities and employment numbers, with firms utilizing inventories and meeting orders directly from warehouses to maintain cost control.

Input price inflation was marginal and the softest in seven months, allowing firms to cut their output charges for the third consecutive month. Business sentiment improved significantly, reaching its highest level since April 2021.

Paul Smith, economics director at S&P Global Market Intelligence, said:

“Most encouraging was the big jump in expectations, with confidence in the future rising to a near three-year high. Signs of price and supply stability are helping to support a more optimistic outlook. Assuming that positive output projections are realised, the downturn in employment seen in March should hopefully prove to be short-lived.”

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