Power index shows slight economic decline in July

Taipei, Aug. 21 (CNA) The Electric Prosperity Index (EPI) released by the Taiwan Research Institute (TRI) on Thursday flashed a "yellow-red" light in July, slightly cooling from June's "red" light.

The TRI, a leading Taiwanese economic think tank, said that industrial high voltage electricity consumption in Taiwan increased 0.34 percent year-on-year, indicating a "warming" economy, in contrast to June's "booming" signal.

The TRI predicted July's economic growth to be 3.5 percent.

The think tank uses a five-color system to gauge Taiwan's power consumption and economic activity. In addition to the red and yellow-red lights, a "green" light signals stable growth, "yellow-blue" indicates a sluggish economy and "blue" represents economic contraction.

The overall manufacturing sector's electricity consumption increased 0.77 percent, with the EPI slowing from red to yellow-red, according to the TRI.

Industry-wise, the semiconductor industry's electricity consumption grew 11.01 percent, the highest monthly growth over the past three years, with the fourth consecutive month of a "red" booming economy. This reflected the high demand for artificial intelligence (AI) servers and advanced process applications, the TRI said.

Also boosted by AI application demand, the computer, electrical and optical products industry saw its electricity usage increase by 6.07 percent, continuing its yellow-red signal.

Meanwhile, the chemical materials industry flashed a blue light, with electricity consumption falling 5.3 percent. The decline was attributed to surplus supply from China's petrochemical industry, falling global oil prices, low-priced international competition, a slowing global economy, and U.S. tariff policies, the TRI said.

Electricity usage in the steel industry also showed a blue light as it fell by 9.55 percent.

The TRI noted that while advance orders placed ahead of the U.S. tariffs provided temporary benefits, these will gradually diminish as businesses adjust their stocking and shipping schedules.

As a result, the TRI predicted that electricity usage would normalize in line with slowing economic growth in the third quarter.