Taiwan: May IP modestly softer than expected: Resilient tech with partial non-tech easing

Research evidence excerpt

Taiwan: May IP modestly softer than expected: Resilient tech with partial non-tech easing

Tingting Ge Asia Pacific Economic Research J P M O R G A N(852) 2800-0143 24 June 2026

tingting.ge@jpmorgan.com

beyond chip shipments. Strong backlog/commitments suggest multi-year visibility rather than

a one-off surge, supportive for Taiwan’s tech manufacturers.

The signing of a US–Iran MoU and the reopening of the Strait of Hormuz have reduced tail risks

of energy shock and eased earlier concerns that energy supply disruptions could potentially derail

Taiwan’s tech upcycle and strong growth momentum. The first CPC-chartered tanker has exited

the Strait after a three-month delay and is expected to arrive in Taiwan mid-July—an early sign

that supply flows are resuming. While it will take several weeks to clear shipping backlogs, and

longer for repairs to regional energy facilities and infrastructure to fully offset the earlier

shortfall, the overall situation is notably calmer than before. Production situations in the

petrochemical industry are also improving. Formosa Petrochemical Corp (FPCC) has lifted the

force majeure declaration it issued three months ago amid naphtha supply disruptions, signaling

a gradual return toward more stable operations.

Retail sales dipped 0.2%m/m sa in May, only partially reversing April's 1.1% gain, while the

annual rate remained solid at 4.9%oya. Trend pace moderated to 7.7%3m/3m saar, but it remains

among the highest readings year to date. Notably, food, beverage, and services sales rose 3.2%m/

m sa. The consumer confidence index was broadly unchanged, edging down slightly to 79.3.

Retail sales have shown resilience in recent months despite the energy shock, helped by local