AI demand lifts Asia factory activity in August, PMIs show
This digest was compiled by AI from multiple sources — links to the originals are below.
Factory activity in China, Japan and South Korea expanded in August on solid demand for AI-related products, private surveys showed on Tuesday. China's Caixin manufacturing PMI rose to 51.5 from 50.9 in July, while Japan's PMI hit 54.9 and South Korea's stood at 52.3. The expansion came even as the prolonged Middle East war fuelled uncertainty and rising costs.
Key Facts
- China's Caixin manufacturing PMI rose to 51.5 in August from 50.9 in July, above the 50-mark separating growth from contraction.
- Japan's manufacturing PMI climbed to 54.9 in August, its highest since April and an eighth consecutive month of expansion.
- South Korea's PMI eased to 52.3 in August from 53.1 in July but remained above 50 for a ninth straight month.
- South Korean exports rose 68.7% year-on-year in August, expanding for a 15th consecutive month.
- Taiwan's PMI stood at 54.7 in August, while Malaysia's eased to 50.2.
China's Factory Rebound
China's Caixin manufacturing PMI rose to 51.5 in August from 50.9 in July, surpassing analysts' estimates of 51 in a Reuters poll. The reading reinforced signs that AI-led demand is helping stabilise parts of China's industrial sector. An official survey showed overall factory activity improved but remained in contraction territory, underscoring the fragility of the broader recovery. Nguyen Hoang Nam, China economist at Capital Economics, said the rebound in the Caixin PMI mirrors the improvement in its official counterpart.
Japan and South Korea Momentum
Japan's manufacturing sector gathered momentum in August as new business grew at the fastest pace since January 2018 on solid demand for semiconductors and AI-related products. The S&P Global Japan Manufacturing PMI rose to 54.9 in August from 54.5 in July, marking the eighth consecutive month of expansion. Annabel Fiddes, economics associate director at S&P Global Market Intelligence, said the sector looks well placed to sustain its strong performance given demand linked to AI-related sectors. South Korea's PMI eased to 52.3 in August from 53.1 in July but remained above the 50 mark for a ninth consecutive month. South Korean exports rose 68.7% year-on-year in August, expanding for the 15th straight month, separate data showed on Tuesday.
Regional Expansion
Factory activity also expanded in Taiwan, Malaysia and the Philippines. Taiwan's PMI stood at 54.7 in August, compared with 55.1 in July. Malaysia's PMI eased to 50.2 after a reading of 50.7 in July. David Owen, an economist at S&P Global Market Intelligence, said the robust increase in export demand was an encouraging sign that firms are still benefiting from the current AI and semiconductor supercycle.
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AI demand lifts Asia factory activity in August, PMIs show
