UPDATE 1-Taiwan Feb export orders top expectations, China strong

* Feb orders up 36.25 pct (forecast median +32.7 pct)

* Pace slows from seasonally skewed Jan record

* China demand still firm, clouds over U.S., Europe

(Adds comment)

TAIPEI, March 19 (BestGrowthStock) – Orders for Taiwan’s exports
grew faster than expectated in February, helped by strong
Chinese demand for the island’s microchips, flat screens and
computers, though some questions remain over the outlook for
consumption in the United States and Europea.

Orders to Taiwan, a bellwether for Asia’s technology makers
and an indicator of global demand, rose 36.25 percent in
February from a year earlier, the Economics Ministry said on
Friday, above a median forecast in a Reuters poll of growth of
32.7 percent.

The pace was much slower than the previous month’s record
figure, which was likely influenced by heavy orders for hi-tech
gadgets ahead of the Lunar New Year holidays. The holiday,
which is celebrated across large parts of Asia, fell in January
last year and mid-February this year.

But analysts said the growth rate should remain at similar
levels for now, thanks to Chinese buying.

“The impact of demand from China is quite large. China is
pushing its farmers to buy things, to raise their quality of
life. As for electronic products sold in rural China, Taiwan
factories can see a benefit,” said Tigr Cheng, economist at
Polaris Research Institute.

“But in the third and fourth quarters, the amount of orders
is unclear. U.S. and European demand for Taiwan exports isn’t
too great. The issues in Greece could have an effect on
European consumers,” Cheng said, referring to Athen’s debt
crisis.

For a graphic on Taiwan’s export order trends, see:
http://graphics.thomsonreuters.com/310/TW_EXPORD0310.gif

A full table of the data can be found at
http://www.moea.gov.tw/

Orders from China in February rose 49.35 percent from a
year earlier, against an annual jump of nearly 135 percent in
January. Orders from U.S. buyers increased 13.5 percent against
an annual 41.8 percent in January.

Asia’s tech exporters, however, are counting on U.S.
companies to use their spare cash to invest in new technology
and computers this year as the economy there slowly recovers.
U.S. analysts have reported strong sales of corporate notebooks
as companies upgrade.

“(Growth in) orders is still stable. March should be higher
than February and April will be higher than March. Looking into
the second half, there’s no reason to be pessimistic if
corporate demand picks up as we expect,” said Chihming Chang, a
spokesman at Compal Electronics (2324.TW: ), the world’s No.2
contract laptop maker.

Shares in chip maker Intel Corp (INTC.O: ) surged earlier
this week on expectations that robust Asian sales and a rebound
in corporate spending will help it beat estimates in the
current quarter [ID:nN16101121].

“Soaring export orders for Taiwanese firms confirm that
global demand continues to accelerate. Already, capacity
constraints are becoming visible in a number of industries,
which will require upgrading of production facilities,”
Frederic Neumann, regional economist at HSBC in Hong Kong.

The firm data is unlikely to alter the outlook for interest
rates in Taiwan, given that price pressures remain contained
despite recent strong data.

The central bank is expected to leave rates at a record low
1.25 percent when it meets for its quarterly rate setting
meeting on March 25.

Stock Market Money

(Reporting by Roger Tung; Writing by Jonathan Standing;
Editing by Kim Coghill)

UPDATE 1-Taiwan Feb export orders top expectations, China strong