Taiwan's manufacturing activity improves in April

Taipei, May 4 (CNA) Taiwan's manufacturing activity improved in April on the back of strong global demand for semiconductors and electronic components, the Chung-Hua Institution for Economic Research (CIER) said Monday.

The April purchasing managers' index (PMI), which gauges the manufacturing sector's climate, rose 4.9 points from a month earlier to 60.3, marking the seventh straight month of expansion, according to data compiled by the CIER, one of Taiwan's leading economic think tanks.

In the service sector, the nonmanufacturing index (NMI) also rose 4.0 points from a month earlier to 58.3 in April, marking the 14th consecutive month of expansion, the data showed.

PMI and NMI readings above 50 indicate expansion, while those below 50 show contraction.

The PMI was given a boost not only by booming demand for AI-related devices but also by manufacturers building up inventories to avoid the potential impact of price hikes for petrochemical products caused by the military conflict in the Middle East.

The five major factors of the April PMI all moved higher from a month earlier, according to CIER data.

The sub-indexes for new orders, production, employment, supplier deliveries and inventories rose 6.4, 9.1, 3.5, 4.3 and 1.0 points, respectively, from March to 58.5, 57,4, 54.6, 70.6 and 60.4, the CIER said.

In addition, the sub-index for the business outlook over the next six months also rose 2.9 from a month earlier to 63.9 in April, the data showed.

Despite the increase in the overall PMI, however, conditions among the index's six major industries diverged in April, though they all remained in expansion mode, the CIER said.

The sub-indexes for the chemical/biotech and electronics/optoelectronics industries moved lower, while the sub-indexes for the food/textile, basic raw materials, transportation tool and electricity/machinery equipment sectors moved higher, the CIER said.

As for the NMI, the four major factors -- business activity, new orders, employment and supplier deliveries -- all moved higher by 6.4, 3.2, 2.9 and 3.3 points, respectively, from a month earlier to 60.6, 60.2. 54.7 and 57.6 in April.

Meanwhile, the sub-index for the business outlook over the next six months also rose 4.3 from a month earlier to 56.7 in April.

The CIER said demand for services from upscale clients in the manufacturing sector stayed strong, and consumer spending rose ahead of Mother's Day, which boosted the service sector further in April.