In August 2007, Taiwan's business indicators continued to show signs of gathering invigoration. Among the indicators compiled by the Cabinet's Council for Economic Planning and Development (CEPD), the leading index and the coincident index increased 0.4% and 1.1%, respectively, from the previous month. The monitoring indicators signaled "green" for the third consecutive month. The positive signs suggest continued buoyancy of the economy. Although the recent subprime market turmoil has had only very limited direct impact on Taiwan's financial markets, the tightening effect on the global economy dampens the prospects for the overall economy.
- Leading Indicators: The composite leading index stood at 147.0, increasing 0.4% from July. Its six-month rate of change was also higher than the previous month. Among the seven indicators making up the composite index, three that made positive contributions were index of export orders, average monthly overtime hours in industry and services, and stock prices. Three that made negative contributions were money supply M1B*, index of producer's inventory and building permits. SEMI book-to-bill ratio stayed unchanged.
(Note: components marked with an asterisk in real terms.)
- Coincident Indicators: The coincident index stood at 151.5, increasing 1.1% from July. Its trend-adjusted series rose for the sixth consecutive month. Among the seven indicators making up the composite index, six that made positive contributions were industrial production, manufacturing sales*, customs-cleared exports*, machineries and electrical equipments imports*, nonagricultural employment and electric power consumption, while the sole negative contribution was from sales index of wholesale, retail and food services.
- The Monitoring Indicators: The total score in June was adjusted upward by one point to 30, following the revision of manufacturing sales. July's total score remained at 30, flashing the "green" signal for the third consecutive month. Among the components, customs exports gained one point while manufacturing sales lost one point, with both individual light signals changed.
- Business Expectations. In the August survey of manufacturers, 12% of the respondents expected the economy to improve over the next three months, up from the revised 11% a month earlier; 14% held a negative view, same as the revised 14% a month earlier; and 74% expected the economy's performance to remain unchanged, down from the revised 75% in the July survey.
T~~ The next release is scheduled for October 26, 2007 ~~T