Although the nation’s leading indicators rebounded for the seventh straight month last month, the pace of economic recovery remains sluggish because of external and internal uncertainties, the Council for Economic Planning and Development (CEPD) said yesterday.
The overall monitoring indicators, which flashed “blue” for the fifth straight month, indicating that the economic momentum remains in the doldrums, confirmed the council’s views.
The leading indicator index, which is used to gauge near-term economic outlook, increased 1.2 percent from a month earlier to 132.1 points, the council said in its monthly report.
The index’s annualized six-month rate of change, which provides a more accurate forecast of the business cycle in the near term, climbed 1.8 percentage points to 8.4 percent last month from a month ago, marking seven months of consecutive improvement, the report said.
“Despite the continuous rising trend [in the leading indicators], we are not sure that the economy has touched bottom,” Hung Jui-bin (洪瑞彬), director-general of the council’s economic research department, told a press conference.
Unlike the uptrend in the leading indicators, the total score of the monitoring indicators dropped 1 point from a month ago to 14 last month, the report showed.
Still, Hung said, overall economic sentiment this month would not be worse than last month, as most segments of the monitoring indicators showed signs of a rebound.
The latest figures on the leading indicators of the OECD and five Asian countries — China, India, Indonesia, Japan and Korea — all showed a continuing recovery, which may provide some upside catalysts for Taiwan’s economy, the council said.
Even if the economy has bottomed out in the first quarter, Hung said the trend of its recovery would be more modest compared with the recovery in 2009.
“This time, it is almost impossible for the economy to show a V-shaped rebound like in 2009,” Hung said.
In addition, external and internal uncertainties, such as stubbornly high crude oil prices, the eurozone’s debt problems, domestic fuel price hikes and impending electricity price increases, could heighten risks for the local economy in the near term, he said.
Still, he added, the overall indicators confirm that annual economic growth would turn stronger quarter by quarter this year.
The coincident index rose 0.1 percent to 127.5 points last month from a month earlier, with its trend-adjusted index dropping 0.6 percent to 94.7, the council said.
The lagging indicators stood at 139.2 points last month, up 0.1 percent from a month ago, with its trend-adjusted index decreasing 0.5 percent to 103.4, data showed.