Tue, Jul 17, 2012 - Page 13 News List

Public confidence in the economy on the rise

By Amy Su  /  Staff reporter

The public’s confidence in the economy rebounded this month on the back of improving sentiment concerning Europe’s debt problems, a survey published by Cathay Financial Holding Co (國泰金控) showed yesterday.

The survey showed this month’s economic optimism index rebounded to minus 40.2 points, after slumping last month to its lowest level in two years to minus 71.8.

The economic outlook optimism index, which gauges public confidence for the six months ahead, also recovered to minus 21.8 from the minus 52.6 points recorded last month, the survey showed.

Both indices marked the first monthly rises after having posted drops for the previous three months.

“The rebounding levels reflect that concern among the public over the economy has been slightly reduced in addition to believing that moves by major global central banks to maintain loose monetary policy could sustain economic momentum,” Cathay Financial, the nation’s largest financial service provider, said in its monthly statement.

Taiwan’s export sector again showed a slowdown last month, further impacting public confidence in the labor market, ensuring that consumption and investment in sub-indexes for durable goods remained sluggish, the statement said.

However, confidence in the labor market and expectations salaries will rise in the second half of the year, following an increase in economic momentum, bolstered public sentiment, Cathay Financial said.

In addition, the survey showed that due to ongoing drops in oil prices, the public has experienced some measure of relief from rising prices.

The public’s expectations that prices for key household goods would continue to climb for the next six months also improved from a range of 4.05 percent to 4.58 percent to 3.41 percent to 3.76 percent this month, indicating that people expect inflation to slow down in the near future.

The survey — conducted from July 1 to July 7 by Cathay Financial — collected 12,270 valid responses from its clients.

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