Sentiment among manufacturers improves for 5th straight month

Taipei, Dec. 26 (CNA) Business sentiment among manufacturers improved for a fifth consecutive month in November as strong global demand for AI applications continued to bolster export-oriented producers, the Taiwan Institute of Economic Research (TIER) said Friday.

The composite index for the manufacturing sector, which gauges business sentiment among local manufacturers, rose 2.39 points from a month earlier to 94.42, according to data compiled by the TIER, one of Taiwan's leading economic think tanks.

Gordon Sun (孫明德), director of the TIER's Economic Forecasting Center, told reporters that based on the index's recent movement, it appeared that the local manufacturing sector had left behind the shadow created by America's tariff policies.

Manufacturers also appeared upbeat that the U.S. Federal Reserve's lowering of interest rates will create wealth effects by pushing up stock markets and eventually boosting private consumption, Sun said.

Other factors that could benefit Taiwanese exporters would be if the Russia-Ukraine war were to end, giving a boost to Europe's and the global economy, and if the China came up with measures to rein in its excessive manufacturing capacity, Sun said.

Citing a survey, the TIER said 24.0 percent of respondents in the local manufacturing sector said their business improved in November, up from 17.9 percent in a similar poll in October, while 23.1 percent of them said their business deteriorated in November, down from 29.8 percent in October.

The survey also found that 23.1 percent of respondents said their operations would improve over the next six months, up from 19.4 percent in October, while 23.7 percent of them expected their operations to worsen over the next six months, down from 30.4 percent in October.

The TIER's composite index for the service sector also rose, gaining 3.09 points from a month earlier to 91.18 in November, while the composite index for the construction industry added 1.12 points to 101.66, marking the sixth consecutive month of growth.

Higher income for stock brokerages on expanded turnover and optimism toward AI development brought optimism to many service sector firms, the TIER survey found.

The local construction industry got a boost from government efforts to expand public work projects and moves by tech firms to build new plants, the TIER said.