Consumer confidence remained weak this month, hitting the lowest point since May 2003 as a result of the public's growing concern about the national economy and stock investments in the near future.
This was the conclusion of the latest monthly report conducted by the National Central University's Research Center for Taiwan Economic Development.
The index this month dropped 0.06 points from last month to 73.06 points, according to the report.
The confidence index gauges people's expectations of stock performance, household finances, durable goods, job opportunities, consumer price fluctuations and the domestic economic outlook for the next six months.
Among the six components, performance of stocks was regarded with the most bearish perspective, with 82.4 percent of the 2,088 respondents who were interviewed between last Friday and Sunday saying that they would keep away from the Taiwan Stock Exchange for the next six months.
According to the Financial Supervisory Commission, the value of transactions on the main bourse totaled NT$4 trillion (US$127.4 million) in the first quarter of the year, plummeting 54.59 percent from NT$8.8 trillion a year ago.
The substantial decline in stock transactions had resulted mainly from the erosion of investors' confidence after a string of corporate scandals, led by Procomp Informatics Co (博達科技) last year, according to commission chairman Kong Jaw-sheng (龔照勝) yesterday.
Kong also attributed the decline to skyrocketing crude oil prices, the US' depressing stock market, the NT dollar's strengthening against its US counterpart and the impact of China's passage of its "Anti-Secession" Law.
Still, the consumer confidence report showed that 77.3 percent of respondents said that the second half of the year will be a good time to buy durable goods, such as houses, cars or large electric appliances.
Shia Ben-chang (
This reflects their lack of confidence in the economy, he said.
"We sent out warning messages at the beginning of the year, hoping the government could propose long-term-stimulus policies. But it has not done enough to boost the economy," Shia said.
Statistics have shown that, despite being based on subjective judgements, the consumer confidence index reflects trends in the nation's economic development over the next four to six months, he said.
Shia said that this should allow time for the government to map out remedies.