Taiwan's export orders in May fell at their fastest pace in more than two years, darkening the outlook for global technology demand that will likely hurt the island's technology exports. The worse-than-expected 5.9 percent annual decline in May came against expectations for a 0.65 percent fall in a Reuters poll and widened from a 4 percent slide in April. May's drop was the worst since March 2013.
The weak data is unlikely to change economists' views that the central bank will probably stand pat on interest rates when it meets to review policy on Thursday. Taiwan is seen in no hurry to lift rates even if the US Federal Reserves raises interest rates given uncertainties in Europe from Greece's debt woes and China's slowdown that continues to muddy the outlook for the island's export-related demand.
"This slide was too pronounced. Nothing has been that bad in the world," said Tim Condon, economist with ING in Singapore. Condon said oil prices like continued to play a role in depressing the value of export orders. May's $35.8 billion in export orders marked the second month-on-month decline in overall orders. While the ministry said the value of June orders should increase from May levels, ministry official Lin Li-jen told reporters: "We aren't seeing a huge spike in demand." Taiwan's orders are seen as a leading indicator of demand for Asia's exports and for hi-tech gadgets.