Manufacturing PMI edges down: CIER

CAUTIOUS OPTIMISM：Although companies are still awaiting clear signs of a recovery, they are less pessimistic about prospects six months ahead, the institute’s head said

The official manufacturing purchasing managers’ index (PMI) last month edged down 0.3 points to 46.8, falling for nine straight months, as companies remained cautious in the face of economic uncertainty, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.

“Most constituents of the index moved by less than 1 point,” virtually unchanged from the previous month,” CIER president Yeh Chun-hsien (葉俊顯) told reporters.

PMI data aspire to capture the manufacturing industry’s health, with values of 50 and higher indicating expansion and scores lower than the threshold suggesting contraction.

Chung-Hua Institution for Economic Research president Yeh Chun-hsien attends a press conference in Taipei yesterday. The official manufacturing purchasing managers’ index (PMI), compiled by the institute, dropped 0.3 points to 46.8 last month, falling for a ninth straight month.／Photo: Hsu Tzu-ling, Taipei Times

Although companies are still looking for clearer signs of a recovery, they are less pessimistic about business prospects in the coming six months, Yeh said.

The critical subindex of new business orders edged up 0.3 points to 48.6, closer to the neutral mark, as companies in the biotechnology, food and textile, as well as raw materials, saw business pick up, while other sectors remained weighed down by tepid end-market demand, CIER’s monthly survey found.

The reading on industrial production lost 1.2 points to 48.2, as some manufacturers cut capacity to save on operating costs. As a result, the employment measure dropped a mild 0.7 points to 47.9, the institute said.

The subindex on inventory declined an insignificant 0.1 points, while the measure on clients’ inventory fell 3.1 points to 41.6, reflecting a conservative and frugal attitude, the Taipei-based think tank said.

Although the worst is likely over, a concrete recovery remains elusive in terms of order visibility and other PMI data, Yeh said.

The value for the six-month business outlook gained 2.7 points to 42.5, it said.

Yeh attributed the sentiment uptick to China’s announcement of stimulus measures to bolster infrastructure, which would benefit local firms focused on the Chinese market.

The S&P Global Taiwan Manufacturing PMI reached similar observations, coming in at 48.3 last month from 47.6 in October.

The downturn in Taiwan’s manufacturing sector continued to ease, as companies exercised caution when making purchases to grapple with muted demand, S&P economics associate director Annabel Fiddes said, adding that the subdued demand placed a lid on price hikes for the time being, although inflationary pressures returned.

The nation’s non-manufacturers fared better with the non-manufacturing index (NMI) gaining 3 points to 56.2, the highest since August last year and expanding for 13 consecutive months, the institute said.

The tourism and hospitality sectors are looking forward to seasonally high sales linked to traditional year-end feasts and employee travel for the first time in four years without COVID-19 disruptions, Yeh said.

The TAIEX’s rally further shored up businesses for fund management and securities houses, the institute said.

Source：TAIPEI TIME​​​​​
Date：Sat, Dec 02, 2023 
Reporter：Crystal Hsu
Site／Link：https://www.taipeitimes.com/News/biz/archives/2023/12/02/2003809993