Ser­vices sec­tor in­dex an­nounces the 12th ‘green light’ in a row

The China Post - - BUSINESS -

Tai­wan’s ser­vice sec­tor re­mained sta­ble in Fe­bru­ary with the in­dex flash­ing a “green light” for the 12th con­sec­u­tive month, ac­cord­ing to the Com­merce Devel­op­ment Re­search In­sti­tute (CDRI, ).

It said do­mes­tic con­sump­tion was boosted in Fe­bru­ary by strong buy­ing be­fore and dur­ing the Feb. 18-23 Lu­nar New Year hol­i­day, Valen­tine’s Day, and the Feb. 28 hol­i­day that marked the 228 In­ci­dent.

In a re­port dated April 7, the CDRI said its in­dex of ser­vice in­dus­try (ISI) stood at 103 points, up from a re­vised 100 in Jan­uary.

The ISI, which as­sesses con­di­tions in the ser­vice sec­tor, flashes a green light when the in­dex is be­tween 100 and 103.

The CDRI uses a five-color sys­tem, in con­junc­tion with the ISI, to de­scribe the cli­mate of the lo­cal ser­vice sec­tor, fo­cus­ing on three ma­jor seg­ments — se­cu­ri­ties trad­ing, the la­bor mar­ket and wages, and busi­ness op­er­a­tions.

Red sig­nals over­heat­ing, yel­lowred in­di­cates slight over­heat­ing, green rep­re­sents steady growth, yel­low-blue sig­nals slug­gish­ness and blue in­di­cates re­ces­sion.

In Fe­bru­ary, the sub-in­dex for se­cu­ri­ties trad­ing fell one point from a month ear­lier to 100 as in­vestors had turned cau­tious ahead of the Lu­nar New Year hol­i­day, when the lo­cal mar­ket usu­ally closes, ac­cord­ing to the data.

In­vestors pre­ferred to cut their hold­ings and raise their cash po­si­tions be­fore the hol­i­day, while watch­ing the mar­ket cli­mate in the world dur­ing the hol­i­day and pre­par­ing for new in­vest­ment strate- gies af­ter trad­ing re­sumed, said the CDRI, one of Tai­wan’s lead­ing think tanks.

As for the la­bor mar­ket, the subindex rose 2 points from a month ear­lier to 103 as la­bor de­mand in the ser­vices sec­tor rose dur­ing the Lu­nar New Year shop­ping sea­son, the think tank said.

Busi­ness in Tai­wan was boosted by strong con­sump­tion in Fe­bru­ary, with the sub-in­dex ris­ing 1 point from the pre­vi­ous month to 101, the CDRI said.

In its out­look for the March data, the CDRI said the ISI is ex­pected to fall slightly from Fe­bru­ary, re­flect­ing weaker buy­ing in­ter­est, par­tic­u­larly in durable goods, af­ter the Fe­bru­ary hol­i­day shop­ping sea­son.

Nonethe­less, the in­dex is likely to con­tinue flash­ing a green light for March, the CDRI said.

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