Asian factory activity expands thanks to global AI boom
SMH•Factory activity expanded in South Korea, Japan and Taiwan in September, supported by demand for chips and AI-related goods. South Korea’s PMI rose to 53.9, Taiwan’s to 56.7, while Japan’s eased to 54.1.
1. Regional factory growth
Private surveys showed manufacturing activity expanded in South Korea, Japan and Taiwan in September as demand for chips and AI-related goods supported export-oriented economies. China’s factory activity also expanded, while activity was mixed elsewhere in Asia.
2. PMI readings diverge
South Korea’s PMI rose to 53.9 from 52.3 in August, its highest reading since May and the fastest activity growth in four months. Taiwan’s PMI increased to 56.7 from 54.7. Japan’s PMI eased to 54.1 from 54.9, its slowest expansion in six months, as output and new orders slowed.
3. Costs remain elevated
South Korea’s new orders and production growth reached their highest levels in about five and a half years, with survey evidence pointing to strength in semiconductors and autos. Japan’s export orders rose for a ninth consecutive month, while firms continued to raise selling prices at one of the sharpest rates since late 2022.
