Taiwan's Economic Monitor Index's Composite Scores Hit 32-Month High in February

Taiwan's economic indicator turned from yellow-blue of a month earlier to green in February, with the composite scores increasing three points to 25, a new 32-month high, according to the National Development Council (NDC).

Among the nine factors that constitute the economic indicator, industrial production, exports, and manufacturing new orders all rose  in February, together advancing four points; while machinery and electrical equipment imports dropped one point with the indicator turning yellow-blue from green.

H.K. Kao, chief secretary of NDC, says that Taiwan's economy is returning to normal. In February Taiwan's exports fared well, particularly the exports of ICs and machine tools that helped boost the island's industrial production and manufacturing sales.

In the same month the annual growth of leading index, used to forecast economic outlook for the next three months, edged up 0.19% for the 18th consecutive monthly growth; and coincident index, designed to assess economic climate in a given month, rose 0.3% for the 10th consecutive monthly rise.

Kao says that currently two risks exist in global business, one being China's adjustment of its economic structure; and the other the potential impact on emerging economies by the withdrawal of U.S. quantitative easing (QE) policy, both of which will surely impact Taiwan, an export-oriented economy.

Nevertheless, Kao is optimistic about the world's business climate as the U.S. seems to be recovering from the sluggishness due to extremely cold winter, and gradual economic recovery is seen in EU and Japan. So, he believes that Taiwan may see better business climate in the coming months.

However, a survey by the Research Center for Taiwan Economic Development of the National Central University shows the prolonged dispute over the Cross-Strait Trade in Services Agreement has undermined Taiwan's consumer confidence index in March, which declined 1.97 from a month earlier to 80.96, with the six parameters of the index all falling, including projected stock market investing over the next six months, buying of durable goods, interest rate hikes, selective credit controls on real estate markets, job opportunities for the next six months, outlook on prices and household finances. (JL)