Sept. PMI Marks 3rd Consecutive Growth in All Six Sub-Indexes: CIER

Taiwan's September PMI rose another 1.7 to 57.7, the most recorded since March 2018, and marked a third consecutive month of growth. For NMI, Chung-Hua Institution Economic Research (CIER) reported a 55.6, marking a four-month expansion; however, it fell short of August's 59.4, signaling a slowing down-rebound.

Among the six sub-indexes, the Electrical & Machinery Equipment industry saw better performance last month than previous months, CIER President Chang Chuang-Chang said. The industry PMI finally ended a 16-month-contracting streak, ending September with 51.0.

Due to a growing machinery equipment industry, all six sub-categories saw indexes entering the 50's range, marking the first expansion on all sides since May 2019. Whether the trend will continue is hard to say, as Supply Management Institute Supply Research Center CEO Lai Shu-hsin said they had forecasted a contracting future for the industry in the next six months at a 45.1 index, suggesting a weaker rebound.

However, Lai remarked that the Electronic & Optical industry showed "too much growth," which reported a 62.4 last month and continued a four-month expanding streak. CIER's President Chang named several factors that buoyed the substantial expansion, such as stabling demand in industrial-use electronics, hotter demand for internet connections, 5G, and automotive-use electronic orders, with figures suggesting growth for urgent orders. Also, increased demands for supply as China's long-holiday in November approaches, and Apple's upcoming 5G iPhone are all factors.

The U.S.-China trade tensions leading to restrictions on Huawei and SMIC also contribute to the rising demand in the electronic and optical industry, CIER stated, as orders surged in Taiwan from Huawei before the Sept. 15 deadline, and SMIC transferring chip orders to Taiwan instead.