Manufacturing, service sector sentiment improves in January

Taipei, Business sentiment in both the manufacturing and service sectors improved in January, as indexes gauging the mood in the two sectors rose from a month earlier, according to the Taiwan Institute of Economic Research (TIER).

The TIER, one of Taiwan's leading think tanks, said the January composite index for the manufacturing sector rose 1.19 points from a month earlier to 100, reversing a four-month decline.

Year-on-year export growth of 15.33 percent in January -- the third straight month with a double-digit increase -- driven by strong global demand and rising raw material prices in the world market were behind the rise in the manufacturing index, the think tank said.

Outbound sales account for 60 percent of Taiwan's gross domestic product, and many of Taiwanese manufacturers are export-oriented.

The sub-index for the domestic construction industry rose for a third consecutive month, gaining 1.39 points from a month earlier to 105.39, the TIER said.

The stronger economic fundamentals also improved the prospects of Taiwan's service sector, with the January composite index posting a month-on-month increase for a second consecutive month, rising 1.38 points from December to 93.05, the TIER said.

The think tank said the higher index for the service sector also reflected the booming stock market in January, when the weighted index on the Taiwan Stock Exchange rose 4.41 percent.

Gordon Sun (???), director of TIER's Economic Forecasting Center, said Taiwan's economy has been benefited from strong growth in major global economies, in particular the U.S. economy, which is one of the largest buyers of Taiwan-made goods.

The higher exports, Sun said, boosted domestic demand and lifted private consumption, leading domestic enterprises to show growing confidence in their business outlook over the next six months.

According to the TIER survey, 34.4 percent of manufacturers polled thought their operations will improve over the next six months, up 9.6 percentage points from a similar survey conducted in December, while 11.8 percent of them said their business will get worse, down 6.9 percentage points from a month earlier.

Separately, data compiled by the Ministry of Labor showed that the number of new job openings provided by the manufacturing and service sectors through the ministry's online job recruitment platform rose 20.76 percent from a month earlier to 99,863, reflecting the stronger economy.

The number of people applying for jobs through the platform in January rose 8.75 percent from a month earlier to 58,471, the data showed.

Source: Focus Taiwan News Channel