Manufacturing boom signal increased in August, with five green lights on in a row
TechNews Financial News
October 4, 2024
Author MoneyDJ
October 4, 2024
Author MoneyDJ
The Taiwan Economic Research Institute announced on the 3rd that the manufacturing boom signal value in August this year was 14.10 points, an increase of 0.29 points from July. The signal showed a green light for the fifth consecutive month, indicating that the business climate was flat.
In terms of the international situation, the Taiwan Institute of Economics pointed out that the European manufacturing PMI was flat. Although the US and Japanese manufacturing PMIs rebounded slightly, they were both stuck in recessionary territory. In addition, China's manufacturing PMI fell for the fifth consecutive month, indicating the prospects for the global manufacturing industry. It is not yet clear that the temperature will return.
On the domestic front, the National Taiwan Institute of Economics said that although global manufacturing demand is still weak, coupled with the decline in international crude oil prices, which has dragged down the performance of demand and sales indicators, China has benefited from the increased demand for new products from international brands and is about to enter traditional sales. Due to factors such as the peak season and the delay in shipments caused by the typhoon in late July, not only exports in August hit a record high in a single month, but the annual growth rate of the manufacturing production index also hit a new high since April 2022, pushing up the performance of raw material input indicators. As for the stock market, in the first half of the month, global stock markets suffered heavy losses due to concerns about the performance of the U.S. economy, which also led to panic selling pressure on Taiwanese stocks. Fortunately, U.S. economic data in the second half of the month was stable, and Taiwanese stocks ended the day with small gains, boosting the business environment. surface indicator performance. Therefore, the manufacturing boom signal value in August was 14.10 points, an increase of 0.29 points from the revised 13.81 points in July, and the signal continued to be a green light indicating that the boom was flat.
Looking at specific industries, the National Taiwan Institute of Economics said that in the machinery industry, it benefited from the expansion of semiconductor production capacity in various countries, which led to an increase in demand for advanced process equipment. The annual change rate of exports turned from negative to positive, and export orders and production indexes still showed a growth trend. Therefore, in August The industry's prosperity signal has shown yellow and red lights representing ascension for the third consecutive month. In the electronic components industry, benefiting from the strong demand for high-performance computing and artificial intelligence applications, as well as the hot demand for new consumer electronics products, the annual export change rate turned from negative to positive, export orders hit a record high for the same month in previous years, and the production index also maintained growth, pushing up According to the performance of various indicators, the industry's prosperity signal in August showed yellow and red lights representing improvement for the third consecutive month.
Overall, the National Taiwan Institute of Economics said that the manufacturing boom signal continued to remain flat in August. Looking at recent economic data related to the manufacturing industry, the electronic components and information electronics industries performed relatively strongly, and exports of traditional industries such as textiles and machinery increased. Although products such as basic metals, petrochemicals and plastics have been affected by China's overproduction and the termination of ECFA tariff concessions, orders from ASEAN, the United States, etc. have increased, offsetting part of the decrease in demand. Although the recovery strength of individual traditional industries is different, it is relatively Improved in the past.
Looking to the future, the Taiwan Economic Academy pointed out that after lowering financing, marginal lending and deposit interest rates by 1 percentage point each in June, the European Union announced another 1 percentage point cut in deposit interest rates on September 12, while the US Federal Reserve announced an interest rate cut of 2 percentage points, and the US dollar The weakening of the index, coupled with the narrowing of interest rate differentials between various countries and the United States, and the outflow of international funds have caused the recent rise in Asian and emerging market stock markets. The People's Bank of China, following the United States, announced a reduction in the deposit reserve ratio and the 7-day reverse repurchase operation interest rate by 0.5 percentage points each. and 0.2 percentage points. Recently, most foreign investment banks expect that China's economic growth will reach the target of about 5% this year. As the world's two largest economies cut interest rates, the pressure on corporate capital costs has been reduced, which will help the recovery of the manufacturing industry, especially in Europe, the United States and Japan in the near future. The manufacturing PMI is both close to the dividing line between boom and bust. How strong will the push be in the future? Can buying gas be sustained? All will affect the export performance of my country's manufacturing industry, and these are the focus of future observation.
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