Taipei, Sept. 1 (CNA) Taiwan’s manufacturing activity remained in expansion mode in August on the back of solid global demand, but the Purchasing Managers’ Index (PMI), which gauges the overall situation in the sector, fell from a month earlier, the Chung-Hua Institution for Economic Research (CIER) said Wednesday.
Data compiled by CIER, one of the leading think tanks in Taiwan, showed that the local PMI for August fell 3.1 after seasonal adjustments from a month earlier to 62.1, after a 1.2 decline in July.
It was the 10th consecutive month the PMI has been above the 60 point mark, but the pace of the expansion was the slowest this year, the data indicated.
Amid eased concerns over domestically transmitted COVID-19 cases, the non-manufacturing index (NMI), which covers service sector activity, also fell 3.5 from a month earlier to 56.7 in August.
For the PMI and NMI, readings above 50 indicate expansion, while those below 50 represent contraction.
CIER Vice President Yeh Chun-hsiang (葉俊顯) said manufacturers in a survey conducted by TIER for the August PMI were export-oriented and the latest manufacturing activity data reflects strong global demand.
Among the five major factors in the PMI, only the sub-index on supplier deliveries moved higher by 1.1 from a month earlier to 69.6 in August, CIER said.
However, the sub-indexes on new orders, production, employment, and inventories moved lower by 5.5, 4.0, 1.9 and 5.3, respectively, from July to 62.3, 62.9, 58.3 and 57.4 in August, while the four factors remained in expansion mode.
Among the six major industries covered by the MPI, only the sub-index for the transportation equipment industry moved higher from a month earlier in August, while the sub-indexes on the electronics/optoelectronics, food and textiles, electrical equipment and machinery, chemicals and biotech, and basic raw materials moved lower.
However, the six industries all remained in expansion mode in the month, according to CIER.
Steve Lai (賴樹鑫), executive director of the Supply Management Institute in Taiwan, said the pace of the global economic recovery moderated from initial fast growth immediately after many economies resumed business activities, so the fall in the August PMI simply reflected that adjustment.
As for the local service sector, Yeh said with the surge in indigenous COVID-19 cases under control, domestic demand increased and pushed up the NMI in August.
Among the major four factors that make up the NMI, only the sub-index on supplier deliveries moved lower by 2.0 from a month earlier to 55.6 in August, while the sub-indexes on business activity, new orders and employment rose 7.6, 5.2, and 3.4, respectively, to 61.5, 56.2 and 53.5, CIER said.
Outside the four major factors, the sub-index on the business outlook over the next six months in the NMI rose 4.2 from a month earlier to 58.3 in August, marking the second consecutive month of expansion, CIER added.
Sorce: Taiwan’s manufacturing activity remained in expansion in August