Taiwan's manufacturing sector expanded at a faster pace in April as firms ramped up production and orders, while cost pressures intensified sharply, according to data released Monday by S&P Global.

The S&P Global Taiwan Manufacturing Purchasing Managers' Index rose to 55.3 in April from 53.3 in March, marking the strongest improvement in business conditions since December 2021.

Output grew at the second-fastest pace since June 2024, while new orders increased at the second-sharpest rate since July 2021, partly driven by stockpiling amid concerns over supply disruptions and rising prices.

New export orders also rose strongly, supported by demand from the U.S., Europe, mainland China, Japan, and Southeast Asia.

Firms stepped up purchasing activity at one of the fastest rates in nearly four-and-a-half years, while supplier delivery times lengthened at the fastest pace in just over four years.

Input costs rose at the steepest pace in nearly five years, prompting firms to lift selling prices at the quickest rate since late 2021.

Employment declined slightly, while business confidence eased to a three-month low, though firms remained optimistic about output growth, supported by expectations of stronger demand, particularly in AI-related sectors.