Wed, Dec 01, 2004 - Page 10 News List

Consumer confidence up

ECONOMIC OUTLOOK An easing of oil-price increases and expectations for a boom in the fourth quarter contributed to the increased optimism, analysts said

By Jackie Lin  /  STAFF REPORTER

With oil price increases easing, the nation's consumer confidence index last month showed a slight increase of 2.15 points to 77.42 points from October, with survey respondents expressing long-awaited optimism on consumer price fluctuations, according to a monthly survey released by National Central University yesterday.

The index gauges the public's expectations on stock performance, household finances, durable goods, job opportunities, consumer price fluctuations and the domestic economic outlook for the next six months.

The survey showed that 76.2 percent of the 2,034 respondents were worried that consumer prices will go up in the near future, down from 81.2 percent in October's report. Those believing that prices might remain stable or even decline constitute 20.1 percent, up from October's 16 percent.

"People's confidence over price fluctuations is turning upward after sliding for seven consecutive months since April," said Chu Yun-peng (朱雲鵬), head of the university's Research Center for Taiwan Economic Development.

As the poll was conducted between Nov. 17 and Nov. 22, when the risk of higher oil prices was leveling out, it is natural that consumer sentiment turned stronger, Chu said.

Day Jaw-yang (戴肇洋), deputy director of Research Division III at the Taiwan Research Institute (台綜院), said the traditional boom season in the fourth quarter also contributed to the bounce in confidence in consumption, although prices for cooking materials such as flour are still climbing.

The rise in the New Taiwan dollar against its US counterpart over the past month has also helped ease price hikes in imported consumer products, Day said.

As the survey shows, respondents also held a bullish view about job opportunities in the next six months, with 62.6 percent saying employment prospects are improving, up from 58.8 percent in October.

The result is not surprising, as the nation's unemployment rate dropped to 4.31 percent last month, its lowest level since May 2001, according to the Directorate General of Budget, Accounting and Statistics.

Although consumer confidence in stock performance and household finances edged up last month in the survey, confidence in buying durable goods and the domestic economic outlook showed a slight decrease from October.

Day said the confidence index might show a marked change next month as the legislative elections to be held on Dec. 11 are expected to affect consumer sentiment.

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