The public’s confidence in the economic outlook is declining this month, with risk appetite retreating to the negative zone as a series of disasters weighs on sentiment, a survey by Cathay Financial Holding Co (國泰金控) showed yesterday.
A total of 37.7 percent of the respondents voiced optimism that the economy will improve over the coming six months, outnumbering their pessimistic peers by 12 percentage points, down from 22.4 points last month, the survey found.
Cathay Financial attributed the softening confidence to the fatal gas pipeline blasts in Greater Kaohsiung on July 31 and Aug. 1 and a deadly airplane crash in Penghu a few days earlier.
Heightened geopolitical tensions abroad also contributed to the change in sentiment that is driving investors to exit the local bourse, and once sent the TAIEX below the 9,000-point level, said Achilles Chen (陳欽奇), assistant manager at the company’s economic research department.
About 23 percent of the respondents expressed plans to cut stock investments, while 20 percent intend to increase stakes, according to the survey, which polled 17,350 Cathay Financial clients via e-mail between Aug. 1 and Aug. 7.
A big majority, 56.7 percent, plan to stay put, the survey said.
In fact, all subindices trended downward, including willingness to sell houses, while the market turns increasingly unfavorable, the survey said.
About 41.4 percent of the respondents think it is not wise to sell houses now and 77.7 percent believe it is ill-timed to buy homes, the survey said, suggesting an extended period of sluggish transactions.
Meanwhile, 82.5 percent of Taiwanese said they have yet to own yuan-denominated deposits and 64.5 percent voiced no interest in holding the currency, the survey found.
The number of customers who plan to own at least 5 percent yuan-linked assets dropped from 20 percent in March to 13.2 percent this month, affirming the currency’s loss of appeal among local investors, the survey said, after expectations of yuan value gains proved unprofitable in the first half.
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Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day