The consumer confidence index (CCI) rose to its second highest level in six years this month, with public sentiment toward stock investment in the near future showing the strongest signs of improvement, the latest survey released by National Central University showed.
The CCI edged up 1.8 points to 77.8 from last month’s 76 chiefly due to a surge of 9.1 points in the sub-index for equities investment in the next six months, the university’s Research Center for Taiwan Economic Development said in the report.
“This is because the European debt crisis appears to have subsided and a yet-to-be-signed ECFA [economic cooperation framework agreement] has boosted the confidence of stock investors in the near future,” center director Hsu Chih-chiang (徐之強) told a media briefing.
The survey, which polled 2,396 adults across the nation between June 19 and last Tuesday, also showed that the public is feeling more confident about job opportunities in the next half year as the employment outlook sub-index edged up 5.1 points to 80.35.
Nevertheless, Hsu said that the respondents felt a bit more conservative than last month about the economy in the second half of this year with the sub-index for the economic outlook in the near future dropping 1.75 points to 81.45, snapping a nine-month streak of growth.
“The pace of economic growth in the second half will slow slightly, but this doesn’t mean that the public is pessimistic about the economy for the full year,” Hsu said, adding that for the economy to expand too fast isn’t a good thing.
Although the central bank’s surprise hike in its key interest rates will cool down economic expansion in the short term, an ECFA with China, surging wages in China and the reduced business income tax rate will boost private investment, which will become the main engine of future economic growth, he said.
Public confidence about household financial conditions and consumer prices over the next six months also fell this month, with the former decreasing 0.85 points to 71.2 percent and the latter dropping 1.35 points to 52.3, the report showed.
A CCI figure between 100 points and 200 points indicates growing optimism about the outlook for the next six months, while a score of less than 100 points shows increasing pessimism, the center said.