Taiwan's Economic Indicator Turns Yellow-blue in January 2014

Taiwan's economic indicator turned from green of a month earlier to yellow-blue in January with composite scores dropping by two points to 22 points, implying a slow economic recovery, according to the National Development Council (NDC).

NDC adopts a five-color gauge for the island's economic performance: green means stable economic growth; red reflects the economy is overheated; yellow-red shows a hating economy; yellow-blue signals an economic slowdown; and blue indicates a recession.

S. Q. Kao, chief secretary of NDC, explains that the slow economic recovery in January was more ore less influenced by unstable global economic climate including sluggish business in the U.S., attributable to the polar weather and the continual withdrawal of quantitative easing (QE) policy.

Among the factors that constitute Taiwan's economic indicator, the annual growth of industrial production index, machinery and electrical equipment imports, and manufacturing sales all posted drops in January. Nevertheless, the climate monitoring index of manufacturing industry turned positive with indicator turning yellow-red from green during the month.

In the same month, the coincident index, used to assess economic climate in a given month, posted the ninth consecutive monthly rise; while the leading index, used to forecast the economic outlook for the next three months showed a decline to end the 16th consecutive monthly growth.

Colors of Criteria Constituting Economic  Indicator in Jan. 2014
Criteria	December 2013	January 2014	Change in scores
Monetary aggregate M1B	Green	Green	Unchanged
Stock price index	Green	Green	Unchanged
Industrial production index	Green	Yellow-blue	-1
Nonagricultural employment	Yellow-blue	Yellow-blue	Unchanged
Customs exports	Yellow-blue	Yellow-blue	Unchanged
Machinery and electrical equipment imports	Yellow-red	Green	-1
Manufacturing sales	Yellow-blue	Blue	-1
Sales index of wholesale, retail, & food services	Yellow-blue	Yellow-blue	Unchanged
Climate index of manufacturing industry	Green	Yellow-red	+1

Source: NDC