The public’s confidence in the economy slumped to its lowest level in two years, according to the results of a survey published by Cathay Financial Holding Co (國泰金控) on Thursday.
This month’s Economic Outlook Index hit a two-year low of minus-71.8 points and the Economic Optimism Index dropped to minus-52.6 points, the survey showed. Cathay Financial said the low levels reflected public concern about global and domestic factors further impacting the economy.
Taiwan’s economic growth has been affected by the current global economic downturn, including the escalating European debt crisis and lowered economic growth forecasts for the US and China, Cathay Financial said.
The European debt crisis has already had an impact on Taiwan’s economy, with last month’s annual export growth rate falling to minus-6.3 percent, suggesting Taiwan’s trading partners have been affected, it said.
However, Cathay Financial’s survey said that due to oil prices falling for the past several weeks, the public has experienced some relief from rising prices.
People’s expectations of hikes in prices of necessities for the next six months also improved from a range of 4.34 to 4.97 percent to 4.05 to 4.58 percent this month, indicating that people expect inflation to fall.
The survey also indicated people’s optimism over salary raises and the bourse was low, but, compared with a month earlier, there was a slight increase in people’s willingness to invest in durable goods.
The survey, conducted from June 1 to June 7 by the Cathay group, collected 15,287 valid responses from its clients.