Finally, Taiwan's manufacturing PMI rose over 50

After 7 months, some good news at last.

According to DBS, there are currently more signs showing that the economy is recovering on the back of better external trade conditions. Export orders surged in November (11.1% YoY, 7.6% MoM sa) thanks to rising demand from the US and China (particularly on electronics).

Here's more from DBS:

Manufacturing PMI rose above 50 in December, the first time over seven months ever since May12. We estimate that real GDP growth in 4Q12 should be able to reach 3-4% QoQ saar, approaching the potential growth rate of 4%.

Taiwan’s central bank left the benchmark rate unchanged at 1.875% at the 4Q policy meeting held on December 19th. The money supply M2 target for 2013 was set at 2.5-6.5%, same as last year’s.

The central bank expects economic growth to recover moderately and inflation pressures to ease ahead in 2013. With the growth-inflation dynamics expected to improve, the central bank is likely to stay pat on interest rates in the next few quarters at least till 4Q13.