Taiwan: Manufacturing PMI rises to over two-year high
November 1, 2016
Manufacturing activity in Taiwan registered a fifth consecutive month of improving conditions, supported by stronger output growth and rising new orders. The Manufacturing Purchasing Managers’ Index (PMI), reported by Nikkei and IHS Markit, edged up from 52.2 in September to 52.7 in October. The Manufacturing PMI reached the highest level since September 2014 and moved further above the 50-point threshold that separates expansion from contraction in the sector.
The solid start to the fourth quarter stemmed from strong growth in manufacturing production and new orders. Sustained growth in new work prompted firms to increase their purchasing activity, which led to an increase in stocks of finished goods, but firms were reluctant to increase their staffing levels. Regarding prices, Taiwanese goods producers signaled that input costs increased notably again in October, however they chose to raise their output charges only modestly.
Author: Ricardo Aceves, Senior Economist