Tue, Oct 18, 2011 - Page 12 News List

Pessimism growing on economy, survey shows

By Crystal Hsu  /  Staff Reporter

Taiwanese turned more pessimistic this month because many expect the economy to deteriorate in the next six months, dulling the outlook for the job and stock markets, a survey released yesterday showed.

The confidence survey, conducted by Cathay Financial Holding Co (國泰金控) on a monthly basis, indicated nearly 50 percent of respondents expect the economy to decline in the next six months, while 21.4 percent have a rosy view. Another 20 percent expressed a neutral sentiment and the remaining 4 percent said they had no idea, the survey found.

The reading on the economic outlook is the lowest since March last year as global recession risks escalate, weakening the nation’s exports, according to the survey that questioned 17,963 people online between Oct. 1 and Oct. 7.

Furthermore, 52.1 percent of respondents expect it to be increasingly difficult to find jobs in the next six months, while 30 percent expect no change and only 9.1 percent say they are optimistic, the survey showed.

Despite bleak views on the economy, 77.2 percent expect consumer prices to climb higher in the next two quarters, and 82.3 percent said they had already felt the pinch of higher prices in the past six months, the survey said. Additionally, 71.9 percent of respondents said it was not a good time to make housing purchases, while 54.2 percent believed it was unwise to sell, the survey said.

The figures suggested a sluggish housing market ahead after the special sales tax chilled residential property transactions by 30 percent for seven straight months. Risk appetite fell lower this month as 38.5 percent of respondents said they intend to cut stock holdings, while 17.7 percent plan to channel more funds to the equity market, the survey found.

Nearly one-third of the respondents, 31.2 percent, expect the TAIEX to hit bottom this quarter and fluctuate between the 6,500 and 7,000 point range ahead of the presidential election in January, the survey found.

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