Taiwan’s February Export Orders Rise the Least in 16 Months
Orders, an indication of shipments in the next one to three months, climbed 5.33 percent from a year earlier, after a 13.47 percent gain in January, the Ministry of Economic Affairs said in Taipei today. The median estimate of 13 economists in a Bloomberg News survey was for a 13.7 percent advance.
The slowdown may not deter the central bank from continuing to raise interest rates even as Japan, the island’s fourth- largest export destination, faces disruption to trade after its biggest earthquake on record. The monetary authority meets March 31 to debate whether to join neighbors from China to South Korea in boosting rates as it tries to avert a property bubble.
“The central bank needs to deal with price pressure internally so it won’t stop tightening because of weak external demand,” Tony Phoo, an economist at Standard Chartered Plc in Taipei, said before the report. It may raise rates by 0.125 percentage point to 1.75 percent at the first quarterly policy meeting of 2011 next week, Phoo said.
Orders from Japan may continue to fall in the coming months following the nation’s March 11 earthquake and tsunami, said Beatrice Tsai, deputy director-general of the economic ministry’s statistics department. They declined in February because the Japanese economy weakened, she said.
Japan, the world’s third-biggest economy, may face damage of as much as 10 trillion yen ($124 billion), or 2 percent of gross domestic product, Citigroup said in a report last week. The disasters may lead to a temporary slowdown in growth which will have a modest short-term impact on East Asia and the Pacific, the World Bank said in a report today.
The Taiex stock index closed up 0.9 percent before the release, according to data compiled by Bloomberg. The Taiwan dollar rose 0.1 percent to NT$29.572 against its U.S. counterpart at the 4 p.m. close, according to Taipei Forex Inc.
HTC Corp. (2498), the world’s largest maker of handsets using Google Inc. and Microsoft Corp. operating systems, said last week the company is not short of materials and has been in close contact with its suppliers in Japan since the magnitude-9 temblor.
Japan makes almost 40 percent of the world’s electronics and audio-visual components, according to Daiwa Securities Group Inc.
Home prices in Taipei rose 12.2 percent last year to a record, according to Dave Chiou, a Taipei-based analyst at Citigroup Inc. Taiwan’s Cabinet this month approved a proposal to impose a tax on property sales to curb speculation.
The central bank raised its benchmark interest rate by 0.125 percentage point in June, September and December last year. The discount rate on 10-day loans to banks now stands at 1.625 percent.
Exports helped propel Taiwan’s annual economic growth to a 24-year high in 2010 and are set to jump more than 11 percent this year, according to government projections.
The value of export orders declined to $28.87 billion last month from $34.46 billion in January, today’s report showed.
Orders from Japan fell 10.41 percent from a year earlier. China and Hong Kong combined increased 2.7 percent from a year earlier, after rising 7.22 percent in January. Purchases from the U.S. climbed 16.91 percent, compared with a 17.97 percent gain the previous month.
Orders for electronics rose 2.72 percent in February, following a 9.85 percent increase the previous month. Demand for information technology and communications products declined 3.59 percent after advancing 6.83 percent in January.
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