Asian factory activity expands thanks to global AI boom
SPY•Factory activity expanded in September in South Korea, Taiwan, Japan and India, with chip and AI-related demand supporting exporters. South Korea’s PMI rose to 53.9, Taiwan’s to 56.7 and Japan’s eased to 54.1.
1. South Korea and Taiwan grow
South Korea’s PMI rose to 53.9 in September from 52.3 in August, its highest level since May and the fastest expansion in four months. Export demand grew at its fastest pace in 15-1/2 years, while new orders and production growth reached their highest levels in around five-and-a-half years. Taiwan’s PMI increased to 56.7 from 54.7.
2. Japan expands more slowly
Japan’s PMI eased to 54.1 from 54.9, its weakest expansion in six months, as output and new orders slowed. Export orders rose for a ninth straight month, while firms continued to raise selling prices at one of the sharpest rates since late 2022.
3. India and regional activity
India’s manufacturing sector expanded sharply, ending a three-month slowdown as demand drove its fastest factory growth in seven months, revived hiring and lifted business confidence. Indonesia and Vietnam also expanded, while the Philippines and Malaysia contracted. Surveys had also shown factory activity expanding in China.
