Business sentiment in Taiwan sinks in August

TAIPEI, Sept. 25 (Xinhua) — Indicators for business sentiment in Taiwan’s manufacturing, service and building industries all dropped in August, said the Taiwan Institute of Economic Research (TIER) Wednesday.
The sentiment reading for the manufacturing industry dropped 2.3 points from that of July to 96.65 points in August, marking the third consecutive month of decline, according to the TIER report.
The service industry indicator dropped to 97.88 points, down by 1.14 points from July, while the construction industry indicator fell by 4.57 points to 107.36 points. Both indicators recorded their second consecutive monthly decline.
In the manufacturing sector, the decline in international oil prices has depressed the selling prices of petrochemical-related products, while demand remains weak. Compared to the previous month, surveyed companies were negative about sale prices, production activity, and new orders. As a result, manufacturers’ outlook for both the current month and the next six months has worsened, the TIER said.
In the service sector, the TIER report noted that, although summer peak season significantly boosted the revenue of the catering industry in August, the weakening performance in local tourism affected the outlook of businesses in the hospitality sector.
Additionally, the stock market on the island experienced sharp fluctuations, with trading volume shrinking and brokerage profits declining, leading many securities firms to hold a negative view of the current economic climate.
Regarding the construction industry, the report highlighted that the recent tightening of mortgage lending by banks has slowed down property registration and transfer processes, creating a cautious atmosphere in the housing market.
Taiwan’s monetary authority introduced new housing market control measures in September, and future liquidity shortages may become a key factor influencing the housing market, the report warned. ■