Taiwan's purchasing managers' index (PMI) for the manufacturing sector fell from 51.8 in October to 48 in November, the first contraction since April 2016, a Taipei-based think tank said Monday.
A PMI above 50 indicates expansion, while below reflects contraction. All four major sub-indices for the manufacturing sector retreated into contraction for November, according to the Chung-Hua Institution for Economic Research (CIER).
Specifically, the index for new orders and the production index dropped to 47.6 and 49.2 last month, respectively, while the index for the supplier delivery time fell to 45.9, ending a 31-month streak of increases.
The CIER index that monitors the manufacturing business outlook for the next six months dived 6.9 points to 33.7 in November, contracting at the fastest pace in almost three years.
The CIER pointed out an overall decline on indices concerning the electronics and optics industry, a key player in Taiwan's manufacturing sector, as suppliers are worried about their orders amid a world smartphone slowdown.
Meanwhile, the service sector PMI gained 2.4 points to 52.3 in November, according to the CIER, as preparations began for the new year sales rush.