Fri, Feb 21, 2014 - Page 14 News List

Public sees rosier outlook for economy: Cathay poll

By Crystal Hsu  /  Staff reporter

Public confidence in the economy rose further this month as major economic data improved, but a lot of people grew more cautious about stock investments after global bourses dipped over the Lunar New Year holiday, a Cathay Financial Holding Co (國泰金控) survey showed yesterday.

A total of 36.8 percent of the respondents expect the economy to gather momentum in the next six months, compared with 24.4 percent who held the opposite view, the survey found.

Another 31.8 percent took a neutral stance, while the remaining 7.5 percent had no opinion, the poll showed.

The latest reading represents a 10-month high and follows the IMF rasing its global GDP forecast for this year, as well as domestic economic monitoring indicators flashing “green” to reflect stable conditions at home, said Achilles Chen (陳欽奇), an assistant manager at Cathay Financial’s economic research department.

As a result, 17 percent of those polled believe that it will be easier to find a job in the coming six months than it is now, although nearly 40 percent said that they expect the labor market to remain unchanged over that period, the survey showed.

The survey showed that 17.4 percent of participants expect their income to increase over the next six months, while 17.6 percent had already seen a pickup in the past six months, figures that also marked a 10-month high.

A big majority, 65.8 percent, of those polled said their wages would likely stagnate in the next six months, while an even larger proportion — 78.3 percent — expect consumer prices to go up over the period, the survey showed.

The findings suggest conservative spending in the future, as 77.9 percent of respondents said it would be unwise to buy a house, far outnumbering their optimistic peers who think it would be wise to enter the property market.

The mismatch may slow home transactions unless sellers are willing to soften prices.

Meanwhile, 31 percent of respondents expect the TAIEX to fall in the coming months, slightly higher than the 30 percent that held a bullish view, the survey showed.

Amid the cautious mood, 54 percent of respondents concluded that it would be better to hold onto their stock holdings, while 21.2 percent plan to increase their stakes and 24.8 percent intend to trim their positions, Cathay’s report showed.

The poll also found that 35.8 percent planned to lower their purchases of durable goods in the next half-year, while 27.2 percent indicated they would cut down on big-ticket items, compared with the respective 19.6 percent and 25.1 percent who plan to increase their consumption of these goods.

In addition, 75.7 percent of respondents said they have little to no knowledge of the Trans-Pacific Partnership, an under-construction trading bloc that the government is seeking to join.

The results suggest ample room for improvement in terms of communication on the part of the government.

The survey polled 34,446 Cathay Financial customers via e-mail from Feb. 4 to Feb. 10.

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