Taiwan Manufacturing Maintains Momentum

The S&P Global Taiwan Manufacturing PMI fell to 54.9 in October 2026 from a more than five-year high of 56.7 in the previous month. Nevertheless, it marked the eleventh consecutive month of expansion, supported by continued growth in new orders amid improving demand conditions across domestic and export markets. Output also increased for another month, although at a slower pace, while employment rose for the fourth consecutive month as manufacturers sought to keep pace with rising workloads. Meanwhile, supplier delivery times lengthened markedly in October as strong AI-related demand strained capacity and shipping delays persisted amid the Middle East conflict. On the price front, input costs climbed sharply again, albeit at a slightly slower pace than in September, reflecting higher prices for metals, plastics and electronics. Consequently, selling prices remained elevated. Lastly, business confidence edged lower but stayed above the series average.

The S&P Global Taiwan Manufacturing PMI rose to 56.7 in September 2026 from 54.7 in August, marking its strongest reading since August 2021. Output and new orders expanded at their fastest rates in over five years, supported by stronger domestic and overseas demand, particularly for AI-related products. Export orders also increased at the quickest pace since July 2021. Employment growth remained modest despite strengthening to its fastest pace since February, while backlogs accumulated at a rapid rate. Purchasing activity accelerated, but supplier shortages led to a sharper deterioration in delivery times. Input cost inflation quickened to one of its highest rates since early 2022, driven by higher raw material costs, including metals and AI-related hardware, while output price inflation accelerated to its fastest pace since June. Business confidence rose to its highest since February, supported by expectations of sustained demand, particularly for AI-related products.

The S&P Global Taiwan Manufacturing PMI edged down to 54.7 in August 2026 from 55.1 in July, marking its softest reading in five months but remaining firmly in expansion territory. Output increased for the ninth consecutive month, while new orders rose at a rapid pace despite moderating from July. New export orders expanded at a faster rate, supported by stronger demand from key markets including the US, Europe, mainland China, Japan, India and Southeast Asia. Employment increased only marginally for the second month in a row, contributing to a sharper accumulation of backlogs. Purchasing activity remained strong, although supplier shortages led to a deterioration in delivery times. Input cost inflation accelerated for the first time in four months, driven by higher raw material prices and stronger demand for AI-related products, while output price inflation eased to a six-month low. Business confidence improved from July's three-month low, on expectations of sustained market demand..