Taiwan’s manufacturing and service providers grew less optimistic about their business outlook due to lingering unease over the global economy and the US fiscal debt problems, as well as the US’ quantitative easing, a think tank said yesterday.
The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) made the observation after releasing the results of its monthly sentiment survey, which showed the business climate gauge for the manufacturing sector falling 2.08 points to 95.91 points last month, from a revised 97.99 points in September.
The latest figures represented a second consecutive month of decline, the survey found.
Only 18.7 percent of local manufacturers polled last month were bullish, when asked about economic prospects over the next six months, weaker than the 20.9 percent recorded in September, the survey indicated.
Meanwhile, respondents with a bearish sentiment rose by 5 percentage points to 25.4 percent, the Taipei-based institute said in its report.
“More respondents became uncertain about their business prospect in the first quarter of next year,” Gordon Sun (孫明德), director of the institute’s macroeconomic forecasting center, told a media briefing.
The US’ fiscal debt problem, which could re-emerge in the first three months of next year, and the exit from the quantitative easing, could both dampen the manufacturing sector’s outlook, Sun added.
Asked about their businesses last month, 17.5 percent of manufacturers said they were optimistic, up 8.7 percentage points from 26.2 percent in September, the survey showed.
A total of 27.8 percent
indicated pessimism, a decrease of 10.6 percentage points from September’s 38.4 percent, the survey showed.
“Most of the manufacturers held a neutral attitude toward their businesses, signifying their ‘stuffy’ feelings under the current economic situation,” Sun said.
In the service sector, the business climate gauge stood at 93.24 points last month, down 0.82 points from 94.06 in September — its third straight month of decline, a separate report said.
Respondents from the telecommunications industry voiced the strongest optimism about the near future, whereas peers in the wholesale sector are the most bearish, the report found.
As for the construction sector, the business climate gauge dropped to 93.96 points last month, from a revised 90.94 points in September, putting an end to four months of retreat, the report showed.
The institute said that a new round of purchasing activity in the housing market over the near future may be triggered by the news that the government may only revise slightly the luxury tax levy.