Taiwan: IP growth likely entered negative territory – Standard Chartered

Taiwan is scheduled to release January industrial production (IP) and unemployment data on 24 February, while the release of the Monitoring Indicators Index for January is scheduled on 27 February. Analysts at Standard Chartered Bank with the preview. USD/TWD trades at 30.415.

Key quotes

“IP likely fell 7.8% y/y, in line with the 17.7% y/y fall in custom exports in January. Weak IP data can also be partly attributed to calendar effects, as January had fewer working days this year compared to last year (Lunar New Year fell in January 2020 versus February 2019).”

“The index – deemed a forward-looking indicator of real economic activity – likely dropped to 22pts from 27pts in December. This indicates the economy slipped into the ‘yellow-blue’ zone, suggesting that real activity was in ‘slow-growth’ mode.”

“Further, the coronavirus outbreak has dampened the near-term growth outlook and will likely exert downward pressure on exports, manufacturing production, and consumer spending.”