Taipei, On the back of a continued recovery in fundamentals at home and abroad, Taiwan's economy has been showing signs of stable growth as an index gauging the economic climate flashed a green light, the National Development Council (NDC) said Monday.
In a statement, the NDC said the composite index of monitoring indicators for July stood at 27 to vault the economy from a yellow-blue light into the green light category, which ranges between 23 and 31.
It was the first time the NDC had used a new model -- which the council said will better reflect the economic situation -- to calculate the composite index of monitoring indicators for July.
Based on the old model, the July figure was 25 points, up from 22 in June, while based on the new model, the latest index was 27, up from 26 in June.
Both the old and new models pointed to stable growth, the NDC said.
The NDC uses a five-color system to gauge the country's economic performance, with blue indicating economic recession, yellow-blue representing economic sluggishness, green denoting stable growth, yellow-red referring to a warming economy, and red pointing to economic overheating.
Out of the nine factors in the index, only three -- the money supply, stock price changes and exports -- moved lower from a month earlier in July, the NDC said.
While the sub-indexes for exports and stock price changes fell, the two still flashed a green light, the NDC said, adding that the sub-indexes for the money supply flashed a yellow-blue light.
The other six factors -- industrial production, employment in the non-farm sector, machinery and electrical equipment imports, revenue posted by the wholesale, retail and food beverage sectors, sales recorded by the manufacturing sector, and business sentiment in the manufacturing sector -- rose month-on-month in July, the NDC said.
Wu Ming-hui (???), head of the NDC's Department of Economic Development, said the higher July composite index largely resulted from an more obvious improvement in machinery and electrical equipment imports and business sentiment in the manufacturing sector.
The NDC said the growth in the leading indicator, which is used to gauge the economic outlook for the coming six months, rose 0.13 percent from a month earlier, but the growth was lower than a 0.14 percent rise seen in June, indicating that the pace of economic growth was not strong enough.
In addition, the coincident index, which gauges the current economic state, fell 0.47 percent from a month earlier in July, which provided additional evidence of a lack of sufficient strength for an economic recovery, the NDC said.
Source: Focus Taiwan News Channel