March Manufacturing PMI rises to 52.7
By ECCT staff reporters
Taiwan's official manufacturing purchasing managers' index (PMI) rose by 1.4 points month-on-month to 52.7 in March, according to a report published on the website of the Chung-Hua Institution for Economic Research (CIER). According to the report, the rise was attributed to increases in the subindices on delivery time and unfinished orders for local manufacturers as the coronavirus pandemic disrupted shipments.
The report quoted CIER president Chen Shi-kuan as saying that “Demand from the supply side, instead of end-market demand, accounted for the PMI increase, reflecting the predicament facing local manufacturers. Many local firms are finding it difficult to deliver goods to their clients or obtain the materials needed to produce electronic components, because of travel restrictions and a shortage of labour in China”.
The gauge on delivery time rose from 57.1 to a record of 63.1, while the index on unfinished orders climbed from 52.9 to 55.9, the institute’s monthly survey showed, although almost all sectors saw a decline in new business and export orders.
The inventory gauge sank from 42.9 to 40.7, indicating that clients ran out of stock but hesitated to build up more, according to Chen.
The subindex on new business orders grew from 55 to 56.9, with companies involved in supplying raw materials being the primary beneficiaries, it said. The industrial output gauge improved from 41.7 to 48.6.
However, the subindex on the business outlook for the next six months plunged from 63.7 to 36.8, given poor visibility.
The outlook for the service sector is much worse. CIER’s non-manufacturing purchasing managers’ index (NMI) for March tumbled at the fastest pace in recorded history from 55 to 40.4, ending 11 straight months of expansion.
Restaurants and hotels suffered the most, with an NMI score of 16.1. Most sectors have a dim view of business given that the six-moth outlook was 26.6, a steep decline from 56.7 a month earlier, according to CIER.