Manufacturing and semiconductors to accelerate, good outlook for Asia

The global manufacturing PMI rose to 53.4 in July, a nine-month high, from June's 52.3. The output index rose sharply to a 10-month high of 56.2 from 53.6 in June while the new orders index also hit a 10-month high of 55.7 from June's 54.1.

The Institute for Supply Management index for the US surged to 56.6 from 53.8 in June. In the euro zone, the NTC Purchasing Managers' Index climbed to 50.8 from 49.9 in June. Japan's PMI rose to 54.1 from 54.0 in June. China's PMI rose to 51.5 in July from 51.0 in June. Not all countries saw improvement though. The UK PMI fell to 49.2 from 49.6 in June and Australia's fell to 48.7 from 55.2 in June.

Manufacturing got a further boost yesterday with the Semiconductor Industry Association announcing that it expected chip sales to accelerate in the second half of 2005 after a 6.5 percent rise in the first six months of the year over the same period in 2004.

All this is good news for the manufacturing- and export-dependent Asian economies. And there have been quite a number of other pieces of good news from Asia lately.

One significant piece was from Japan. Average land prices in Tokyo were reported to be up this year -- the first rise in 13 years. Nationwide, land prices fell, but by the slowest rate in 13 years.

In addition, wages were up in Japan in June, with total cash earnings up 1.1 percent over the previous year, while full-time employment rose 1.0 percent.

South Korean exports rose 11.4 percent in the year through July, the fastest pace in four months, while consumer inflation slowed to 2.5 percent year-on-year, the lowest since August 2002.

Meanwhile, Taiwanese and Singaporean businesses are optimistic about the outlook. 24.7 percent of Taiwanese businesses surveyed expected an upturn in the second half of this year while 18.4 percent were bearish in their expectations. In Singapore, businesses in the manufacturing and services sectors are reported to be optimistic about the business outlook for the second half of 2005.