Taiwan's PMI hits record low in May

Source: Xinhua| 2020-06-01 23:30:37|Editor: huaxia

TAIPEI, June 1 (Xinhua) -- Taiwan's purchasing managers index (PMI) dropped to 44.8 percent in May, the Chung-Hua Institution for Economic Research (CIER) said on Monday.

The PMI for May fell by 2.8 percentage points to 44.8 percent, the lowest since the index was first released in July 2012, the CIER said in a press release.

A PMI above 50 suggests expansion, while below 50 means contraction of manufacturing activities.

Among the five sub-indexes, new orders, production and employment contracted to the lowest level since July 2012 while supplier deliveries became slower and inventory levels expanded, according to the CIER.

However, the business outlook index for the next six months rebounded to 30.8 percent in May by 5.1 points after a drastic reduction of 26.9 points in February, indicating an improving sentiment among manufacturers.

Despite the moderate improvement of the COVID-19 situation in Taiwan, it is too early to tell when the economy will recover, the think tank said.

It forecast a further downturn of the local economy in the second half of the year since businesses will suffer as a result of order cancellations, delivery delays and disruption of capital flows.

For the services sector, the non-manufacturing index (NMI) rose by 2.7 percentage points from the previous month to 45.2 percent in May but maintained a contracting streak for the fourth month, according to the CIER. Enditem