Key economic indicator remains positive in May

Taipei, June 27 (CNA) Taiwan's economy continued its momentum in May, with a government indicator of business activity flashing a green light for the fourth consecutive month, signaling steady growth, the National Development Council said Friday. The streak is the longest since the light flashed green for five consecutive months from March to July 2011, the council said. The result did contain a warning sign, however, with the score of the nine monitoring indicators that comprise the composite index falling five points in May to 24, after hitting 29 in April, the highest since May 2011. Chen Chien-liang, the council's deputy chief, expected Taiwan's economic outlook to remain stable despite the drop.
"We're definitely on the track of recovery," he said, predicting that the indicator will flash a green light again in June. He cautioned, however, that the mild recovery seen in emerging markets needed to be watched closely. The composite leading index, an indicator of the outlook for the coming one to two quarters, stood at 104.34, down 0.04 percent from April, ending a 20-month growth streak.
Its trend-adjusted index slid by 0.18 percent to 100.44 points, marking the third consecutive monthly drop, the council said. Meanwhile, the coincident index rose by 0.23 percent to 104.79 from the previous month, while the trend-adjusted index increased by 0.10 percent to 100.87, the 13th consecutive month the index rose. The council uses a five-color system to gauge economic health, with red signaling overheating, yellow-red showing slight overheating, green indicating steady growth, yellow-blue signaling a slowdown and blue indicating recession. (By James Lee)