Taipei, June 27 (CNA) The local economy flashed a green light indicating steady growth for the fourth consecutive month in May, partly on the back of growing exports at a time of solid global demand, the National Development Council (NDC) said Wednesday.
In addition, sales generated by the local retail and wholesale sector were on the rise and business sentiment among Taiwanese manufacturers improved, which further bolstered the local economy, according to the NDC.
In a statement, the NDC said the composite index of monitoring indicators for May rose two points from a month earlier to 28, the highest level for this year, to flash the green light, which is in a range of 23-31 points.
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 composite index, six moved higher, with the sub-index for exports moving up to flash a yellow-red light, an improvement from a green light seen in April.
In May, Taiwan’s outbound sales rose 14.2 percent from a year earlier to US$29.12 billion. The May figure was also up 8.9 percent from April.
The NDC said the sub-index on business sentiment of the local manufacturing sector also improved to flash a yellow-red light in May, compared with a green light in April.
The sub-indexes for machinery/electrical equipment imports, sales generated by the retail/wholesale/food and beverage industry, and revenue posted by local manufacturers rose from a month earlier in May, maintaining a green light, the NDC said.
In addition, the sub-index on money supply increased in May, flashing a green light, an improvement from a yellow-blue light seen in April, the NDC added.
However, the sub-indexes on equity prices, industrial production and non-farm payrolls moved lower month-on-month in May to flash either a green light or a yellow-blue light for the month, the NDC said.
The latest composite index echoed government optimism toward the economic growth for 2018.
In late May, the Directorate General of Budget, Accounting and Statistics (DGBAS) upgraded its growth forecast for Taiwan’s 2018 GDP by 0.18 percentage points to 2.60 percent.
The NDC said the leading indicator, which is used to gauge the economic outlook for the upcoming six-month period, fell 0.07 percent from a month earlier to 100.70, marking the sixth consecutive month for the indicator to fall month-on-month.
However, the council said it is not worried about the fall, since the latest drop was narrowed from a 0.12 percent decline seen in April and became the smallest shrinkage so far this year, indicating that the local economy remained in expansion mode at a steady pace.
(By Pan Tzu-yu and Frances Huang)