Local manufacturing sector sentiment shows improvement

Business sentiment in the local manufacturing sector improved in July as Taiwan's exports rebounded, according to a survey released by the Taiwan Institute of Economic Research (TIER, ???) Thursday.

TIER, one of Taiwan's leading think tanks, said the survey indicated that the manufacturing composite index for July rose 1.97 points to 98.63 after falling in June.

The rise in the manufacturing composite index for July reflected the latest trade data in Taiwan, which showed exports picking for the first time in 18 months, ending the longest slump in the country's history.

In July, the country's outbound sales grew 1.2 percent year-on-year to US$24.12 billion, ending 17 consecutive months of decline, largely on the back of solid demand for electronics devices, in particular high-end semiconductors, the TIER data showed.

In addition, the industrial production index for the manufacturing sector rose 0.65 percent from a year earlier, after a 1.58 percent year-on-year increase in June, which helped boost Taiwanese manufacturers' sentiment, TIER said.

However, Gordon Sun (???), director of TIER's Economic Forecasting Center, said that although sentiment in the manufacturing sector rebounded, only the semiconductor segment saw an increase in shipments.

In the local construction sector, sentiment also improved in July on an increase in transactions of residential and commercial property in Taiwan's six major metropolises, TIER said.

The sub-composite index for the construction sector rose 4.13 points in July from a month earlier to 90.08, the highest level in 21 months and the fifth consecutive monthly gain, according to TIER.

In July, transactions of homes, offices and shops in Taipei, New Taipei, Taoyuan, Taichung, Tainan and Kaohsiung hit 18,259 units, up about 7 percent from a month earlier.

In the local service sector, however, sentiment remained cautious as the transportation/logistics/warehousing segment maintained a conservative outlook amid rebounding international crude oil prices, TIER said.

Therefore, the composite index for the local service sector fell 1.17 points month-on-month in July to 84.37, TIER said.

It said the cautious outlook toward crude oil prices eclipsed the gains posted by the local equity market in July.

Source: Focus Taiwan