Taipei--The local manufacturing sector flashed "yellow-blue" in December for the third consecutive month, compared with "blue" recorded in September, as the local economy continues to recover, the Taiwan Institute of Economic Research (TIER) said on Thursday.
TIER, one of the leading economic think tanks in the country, said that although the composite index for the local manufacturing sector in December was 11.47, down from November's 12.20, that still indicates yellow-blue, which ranges from 10.5 to 13.
The think tank uses a five-color system to describe economic activity, with red indicating overheating, yellow-red fast growth, green stable growth, yellow-blue sluggish growth and blue contraction.
According to TIER, the decline in the December score reflected slower demand for the iPhone 7, the latest iPhone model unveiled by Apple Inc. in September, which impacted sales of many Taiwanese high-tech firms in the supply chain.
TIER said that a shortage in dynamic random access memory chips also caused a downturn in output at other electronics manufacturers such as PC firms, pushing down the sub-index for the electronics components segment for the month.
The TIER data showed that the sub-index flashed yellow-blue, down from green in November.
As international crude oil prices climb, petrochemical related firms saw the prices of their products rise, TIER said, adding that the sub-index for the petrochemical/rubber segment flashed green in December, improving from yellow-blue a month earlier.
TIER said that with the local economy expected to recover this year, the manufacturing sector should perform better than last year.
Last month, the think tank raised its forecast for gross domestic product (GDP) growth for 2017 from 1.65 percent to 1.78 percent on the back of rising global demand.
TIER said that the electronics component segment is expected to benefit from solid global demand and the efforts of international smartphone brands to launch new devices this year. The sub-index for the segment could flash green in 2017, an improvement on yellow-blue in 2016.
In addition, the sub-index for the petrochemical/rubber segment could flash yellow-blue in 2017, compared with blue in 2016, TIER said.
Source: Focus Taiwan News Channel