Taiwan disappoints with 1.58pc growth
Reuters in Taipei
Taiwan's economy grew by a preliminary annual pace of 1.58 per cent in the third quarter and was flat from the previous three months, reflecting how global demand for Asia's exports remains sluggish.
The annual figure, announced yesterday, was far below the 2.44 per cent growth median in a poll and the revised 2.49 per cent year-on-year growth for the April-June period.
The statistics agency said that on a seasonally adjusted quarterly basis, gross domestic product expanded only 0.09 per cent in July-September, compared with 0.58 per cent in the second quarter. Exports, consumption and investment were all below forecasts, it added.
"It's a big downside surprise," said Raymond Yeung, senior economist at ANZ in Hong Kong.
Leong Wai Ho, economist at Barclays Capital in Singapore, agreed yesterday's numbers were a "big miss" but said he believed it was because numbers were centred on activity in July and August, which were "weaker months for services where Chinese visitor arrivals were relatively weak".
Exports are pivotal for Taiwan, but by the government's statistics, the services sector accounts for nearly 70 per cent of GDP.
Leong said manufacturing was "much stronger in September, and I expect the preliminary numbers did not capture the full effect of September. I think the final number should be closer to 2 per cent when it's revised upwards".
The statistics agency is expected to unveil final GDP numbers for the third quarter in two to three weeks.
Leong expects there should be a "more substantial pop" as the level of caution among producers dissipates when they get orders for Christmas from the G3 economies.