Key economic indicator shows steady growth in February

http://www.taiwannews.com.tw/etn/news_content.php?id=2711209

 

Taipei, March 27 (CNA) Taiwan’s economy continued to enjoy positive momentum in February, with a government indicator of business activity flashing a green light for the second consecutive month, signaling steady growth, the country’s economic planning body said Friday. The score of the nine indicators that comprise the composite index increased one point to 24 for February, thanks to strong domestic demand and rising private investment, according to a regular report on the domestic economy released by the National Development Council that day. The report said that among the nine components, the TAIEX average closing price and imports of machinery and electrical equipment each gained one point to change their signals from green to yellow-red. Sales of trade and food services added one point to change its light from blue to yellow-blue, while the monetary aggregate M1B and the index of producers’ shipments for manufacturing each lost one point to turn their lights from green to yellow-blue. The signals for the remaining four components remained unchanged. The council uses a five-color system to gauge economic health, with red signaling overheating, yellow-red showing slight overheating, green indicating steady growth, yellow-blue signaling a slowdown and blue indicating recession. Wu Ming-huei (???), director of the council’s Economic Development Department, said the rise in the score for stock prices and commercial revenue represented strong private consumption, which triggered domestic demand. The score for imports of machinery and electrical equipment indicates high investment willingness, suggesting warming private investment, Wu said. The trend-adjusted leading index stood at 99.6 in February, down by 0.1 percent from the previous month, while the trend-adjusted coincident index reached 100.62, down by 0.22 percent from January. Wu said that the leading index — an indicator of the outlook for the subsequent one or two quarters — has dropped for 12 months in a row. However, in total, the fall has only reached 1 percent, small enough for the council to continue holding a positive economic outlook for the future. This year, gross domestic product growth in the United States, the euro zone and Japan is expected to be on a larger scale than the previous year, which will help boost Taiwan’s export momentum, the official predicted. In terms of domestic demand, emerging business opportunities in the mobile device and intelligent chip application sectors could trigger investment in these and other relevant industries, while the substantial consumption power will be stronger, thanks to improved employment figures and low fuel prices, according to Wu. (By Chen Cheng-wei and Elizabeth Hsu)

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