News
May PMI surges to 55.4
By ECCT staff writers, CIER
Taiwan’s official manufacturing Purchasing Managers Index (PMI) in May rose sharply to 55.4, a jump of 6.0 percentage points from the previous month and ending 14 consecutive months of contraction (below the neutral level of 50). According to the monthly report of the Chung-Hua Institution of Economic Research (CIER), the rise was mainly due to the decline in uncertainty in international markets. Brand manufacturers have replenished their inventories with the new orders, taking the production index to a rate of 60.0%, which is the highest level in more than two years. The outlook index for the next six months also climbed 4.9 percentage points to 60.1, which is also the fastest expansion rate since April 2022, indicating that manufacturers have become more optimistic about the future prosperity. At the same time, the reading on raw material prices increased 2 points to 66.1, meaning that firms are feeling price pressures.
Among the five component indicators, seasonally adjusted new orders, production and manpower hiring showed expansion, supplier delivery times all increased, and were above 50.0. Only inventory remained below 50.0.
According to CIER there was a sharp rise in new orders in the chemical and biotech medical industry, electronics and optical industry, food and textile industry, and basic raw materials industry. Among them, the new orders and production index of the electronics and optical industry have maintained an expansion rate of above 60.0 for three consecutive months. In addition to the AI and semiconductor-related supply chains that will begin to gain steam in the second half of 2023, other electronic component companies have also reported expansions in orders, production and prospects.
Meanwhile, Taiwan's non-manufacturing managers' index (NMI) has expanded for 19 consecutive months, with the index rising slightly by 0.1 percentage points to 54.2%. Among the four component indicators, business activities, new orders and manpower hiring all showed expansion, and supplier delivery times all increased and were higher than 50.0. The future outlook index has expanded for seven consecutive months, with the index jumping 8.7 percentage points to 63.6, the fastest expansion rate since January 2022.
