Taiwan’s export orders fall slightly in March, trade growth to rebound in Q2 2016

Taiwan’s export orders in declining slightly on an annual basis last month. It fell 4.7% y/y, as compared with consensus expectations of a drop of 8% and better than January-February’s average of a decline of 9.9%. In seasonally adjusted terms, export orders rose 5.4% m/m last month, growing positively for the first time in five months.

Orders for export from the ASEAN market rebounded the most. Orders rose sharply by 9.2% y/y, as compared with January-February’s average of -2.7%. Meanwhile, demand continued to decline from China, Hong Kong, Europe and the US; however at a slower rate. Chemicals, plastics, rubbers, electronics and information and communication products primarily drove the rebound in orders.

In all, March’s data supports the view that the country’s manufacturing and trade growth bottomed out in the first quarter of 2016 and will recover in the second quarter, according to DBS Bank. However, it is uncertain if the Taiwanese economy will enter the recovery phase, noted DBS Bank.

Taiwan’s export orders in March on a month-on-month basis continue to be modest that will unlikely counter the constant drop in the last four months. Moreover, orders from China and G3, which are Taiwan’s important markets, have not clearly recovered. Additional signals are required to argue that considerable rebound is underway, added DBS Bank.