TAIPEI: The local manufacturing sector continued to flash a “yellow-blue” light for the third month in a row in August, signaling sluggish growth, although the composite index and other indicators rose slightly from July, according to a report released Friday. In the report, the Taiwan Institute of Economic Research (TIER) said that the composite index for the manufacturing sector rose 0.95 points in August to 11.49, from 10.54 the previous month. It was the third consecutive month of sluggish growth in the sector, as indicated by the yellow-blue light, TIER said. TIER uses a five-color system to categorize economic activity, with red indicating overheating, yellow-red showing fast growth, green representing stable growth, yellow-blue signaling sluggish growth and blue reflecting contraction.
TIER researcher Fang Chun-teh noted that while the August composite index remained in the yellow-blue category, the actual index rose from the previous month. He said it is hoped that the release of new handsets, wearables, and other electronic devices will spur larger orders to manufacturers in the supply chain in the coming months. Other factors that might boost Taiwan’s exports include an increase in the price of raw materials and higher demand during the upcoming peak shopping seasons in Europe, the United States and China, Fang said. If all those factors come together, the composite index might move to a green light, Fang said. However, TIER’s outlook for the rest of the year remains conservative, amid uncertainty over sales of the new iPhones and competition from China, he said.
