Orders for trade-dependent Taiwan, which have seen steady single-digit growth since a small dip in June, rose 4.2% in September from a year earlier to $47.86bn, a record for that month, Ministry of Economic Affairs data showed yesterday.
The data “shows that the impact of the US-Sino trade war has gradually surfaced,” said Carl Liu, an analyst at KGI Securities.
But analysts said continuing demand for gadgets for Christmas and end-of-the-year shopping should boost orders in the short-term.
The later part of a year is traditionally the strong season for vendors such as Apple Inc due to product launches.
Orders for telecommunication products reached a record in September “mostly due to new smartphone and wearable device launches from international vendors,” the ministry said in a statement.
“Although traditional orders were affected by the Sino-US trade frictions, the full-year order could still reach over $500bn,” ministry official Lin Li-chen told reporters, referring to orders from sectors including metal products and machinery. The ministry said machinery orders suffered the first month-on-month decline since August 2016 as companies in China were “turning cautious” as the trade dispute escalated.
Liu of KGI Securities said machinery and optics were among the worst affected by the dispute, adding that Taiwan’s total exports in the fourth quarter might not increase from July-September and might even contract.
A Reuters poll had forecast 5% growth in September orders, while the government projected 5%-7.1%.
Taiwan’s export orders are a leading indicator of demand for Asia’s hi-tech gadgets and other shipments, and typically lead actual exports by two to three months.
The government forecast an annual increase of 3%-5.1% in October.
Orders from the United States, rose 3.7% in September from a year earlier.
In August, they rose 14.9%.
Those from China increased 1.3%, compared with rising 7.3% the previous month.
Orders from the European Union rose 13% and for Japan fell 8%.
Taiwan’s central bank last month revised its economic growth forecast for this year to 2.73% from June’s projection of 2.68%, and said it would maintain appropriate loose monetary policy to support growth.
It forecast expansion to slow to 2.48% next year.
