The IHS Markit Taiwan Manufacturing rose to 50.8 in December 2019 from 49.8 in a month earlier. This was the first growth in factory activity since September, supported by a renewed increase in total new work, purchasing activity and staffing levels. Meantime, output volumes were broadly stable. At the same time, export sales fell further, amid weak demand from China, Europe and the US. Meanwhile, capacity pressures were evident, as shown by a renewed rise in backlogs of work. Though modest, the rate of accumulation was the fastest seen since August 2018. Regarding inflation, input costs rose the most since March, with a number of panel members citing increased prices for raw materials. Despite the stronger rise in cost burdens, companies continued to cut their factory gate prices in order to remain competitive. Lastly, sentiment was at four-month high, partly linked to new product releases, efforts to expand client bases and hopes that trade tensions will ease. Manufacturing PMI in Taiwan averaged 51.22 points from 2011 until 2019, reaching an all time high of 56.90 points in January of 2018 and a record low of 45.50 points in June of 2019. source: Markit Economics

Manufacturing PMI in Taiwan is expected to be 49.50 points by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Manufacturing PMI in Taiwan to stand at 49.10 in 12 months time. In the long-term, the Taiwan Manufacturing PMI is projected to trend around 49.80 points in 2020, according to our econometric models.

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Taiwan Manufacturing PMI

Actual Previous Highest Lowest Dates Unit Frequency
50.80 49.80 56.90 45.50 2011 - 2019 points Monthly

News Stream
Taiwan Manufacturing Remains Stuck in Soft Patch
The IHS Markit Taiwan Manufacturing PMI stood at 49.8 in November 2019, the same as in October, signalling a further fractional deterioration in operating conditions. Notably, the health of Taiwan's manufacturing sector has failed to improve in any month since October 2018. Both output and new orders fell slightly, while new export business continued to contract solidly. Meantime, buying levels reduced again and firms also cut their inventories of both purchased and finished items. At the same time, workforce numbers were unchanged, following a four-month sequence of expansion, as firms became more cautious towards staff hiring. At the same time, signs of spare capacity persisted, as highlighted by a further decline in outstanding workloads. On the price front, selling prices fell again, despite a slight increase in overall input costs, suggesting a further squeeze on margins. Lastly, confidence remained relatively fragile overall.

Taiwan Manufacturing Contracts Again
The IHS Markit Taiwan Manufacturing PMI slipped to 49.8 in October 2019 from 50.0 in the previous month. Total new work and export sales continued to contract, with a number of firms commenting on reduced orders across key markets such as China and the US as trade wars continued to weigh on demand. Also, input buying fell modestly, with the rate of drop little-changed from September. On a brighter note, output and employment both increased. However, the expansion of output was only fractional, and often attributed to efforts to fulfill outstanding orders. On the price front, selling prices dropped further, amid increased competition, while input cost rose slightly, ending a six-month period of falling prices. Finally, sentiment was negative on the back of ongoing trade disputes and forecasts of weaker global demand.

Taiwan Manufacturing Stabilises
The IHS Markit Taiwan Manufacturing PMI rose to 50.0 in September 2019 from 47.9 in the previous month, pointing to stable operating conditions in the manufacturing sector. The result ended an 11-month sequence of deterioration, as employment grew the most since May 2018, while both output and new orders fell at softer rates. Also, both export sales and buying levels shrank the least in four months. Meanwhile, backlogs of work increased for the first time in four months. On the cost front, input prices continued to decline, with the rate of inflation accelerating from August. As a result, firms opted to cut their output charges. Lastly, sentiment weakened to a fractional level due to worries over export conditions.

Taiwan Manufacturing Shrinks for 11th Month
The IHS Markit Taiwan Manufacturing PMI dropped to 47.9 in August 2019 from 48.1 in July. This was the eleventh straight month of contraction in the manufacturing sector, with both output and total new orders declining for the twelfth month running and at solid rates. Also, export orders continued to fall sharply overall, with the rate of reduction among the quickest seen over the past four years. In response to weak overall demand conditions, firms cut back on their buying activity and their holdings of both purchased and finished goods. On a more positive note, employment rose slightly for the second straight month, with backlogs of works depleting further. On the price front, average input costs fell further, amid widespread reports of lower raw material prices. At the same time, firms cut their selling prices again, and at a faster rate than in July. Looking ahead, confidence strengthened, as companies anticipate greater investment, new products and stronger market conditions.

Taiwan Manufacturing Shrinks at Softer Rate
The IHS Markit Taiwan Manufacturing PMI increased to 48.1 in July 2019 from June's 91-month low of 45.5. Output fell modestly, while firms also signalled softer reductions in total new work and purchasing activity. At the same time, companies expanded their workforce numbers slightly for the first time since March, while backlogs of works fell further, though the rate of depletion was softer than that seen in June. On the price front, input costs fell at the steepest rate since early 2016, while firms cut their selling prices again. Finally, reports of relatively subdued global demand conditions and the ongoing China-US trade dispute continued to dampen business confidence regarding the year ahead.

Taiwan Manufacturing Activity at 7-1/2-Year Low
The Nikkei Taiwan Manufacturing PMI fell to 45.5 in June 2019 from 48.4 in the previous month. The latest reading pointed to the sharpest contraction in the factory activity since November 2011, as output continued to decline and new orders and overseas sales shrank further amid reports of subdued global demand conditions. Consequently, buying levels contracted at the steepest pace in over 7-1/2 years and stocks of both purchasing and finished items declined at faster rates. Also, employment went down for the second consecutive month amid reports that firms were choosing not to replace voluntary leavers. On the price front, input prices dropped for the second straight month and at the quickest pace in 39 months due to lower cost of raw material, while output charges fell markedly amid efforts to stimulate demand. Lastly, sentiment deteriorated to the lowest since September 2015, due to a slowing global economy outlook and the ongoing China-US trade dispute.

Taiwan Manufacturing PMI
The IHS Markit Taiwan Manufacturing Purchasing Managers’ Index measures the performance of the manufacturing sector and is derived from a survey of 300 industrial companies. The Manufacturing Purchasing Managers Index is based on five individual indexes with the following weights: New Orders (30 percent), Output (25 percent), EmploySuppliers’ Delivery Times (15 percent) and Stock of Items Purchased (10 percent), with the Delivery Times index inverted so that it moves in a comparable direction. A reading above 50 indicates an expansion of the manufacturing sector compared to the previous month; below 50 represents a contraction; while 50 indicates no change.

Taiwan Business Last Previous Highest Lowest Unit
Manufacturing PMI 50.80 49.80 56.90 45.50 points [+]
Industrial Production 2.15 -2.64 75.71 -43.30 percent [+]
Industrial Production Mom 2.66 0.17 9.75 -16.01 percent [+]
Manufacturing Production 2.29 -3.05 84.23 -45.43 percent [+]
New Orders 44534.00 47279.00 48986.00 2278.00 USD Million [+]
Changes in Inventories -24853.00 -20989.00 74009.00 -130795.00 TWD Million [+]
Bankruptcies 3398.00 3029.00 7810.00 1144.00 Companies [+]
Car Production 25614.00 24565.00 436732.00 7620.00 Units [+]
Car Registrations 22111.81 22084.07 22456.11 15439.63 Thousand [+]
Leading Economic Index 113.60 112.90 113.60 20.80 points [+]
Internet Speed 16869.04 15640.45 16869.04 2728.96 KBps [+]
IP Addresses 7115844.00 7090423.00 12042415.00 4219872.00 IP [+]
Mining Production 0.29 -5.28 48.10 -37.70 percent [+]
Steel Production 1670.00 1825.00 2093.77 243.00 Thousand Tonnes [+]
Cement Production 933.04 863.55 2201.45 748.64 Thousands of Tonnes [+]
Coincident Index 111.34 110.55 114.86 20.48 points [+]
Competitiveness Index 80.24 79.25 80.24 5.20 Points [+]
Competitiveness Rank 12.00 13.00 17.00 12.00 [+]
Ease Of Doing Business 15.00 13.00 15.00 10.00 [+]
Corruption Index 63.00 63.00 63.00 49.80 Points [+]
Corruption Rank 31.00 29.00 39.00 25.00 [+]