Consumer confidence climbed to a record high this month, as a stable economy and hot money inflows raised investment interest, a survey by National Central University (NCU) showed yesterday.
However, positive public sentiment failed to facilitate property transactions due to policy uncertainty, according to the survey, which polled 2,436 Taiwanese adults by telephone between March 19 and Monday.
The Consumer Confidence Index, which gauges private consumption over the next three to six months, reached 91.13 this month, an increase for the fifth month in a row, but still below the neutral threshold, the survey found.
A score above 100 indicates optimism and a score below that suggests pessimism.
“The latest reading suggested further sentiment improvement, but stagnant wages checked the pace of the pickup,” National Central University economics professor Dachrahn Wu (吳大任) said.
The confidence reading has yet to surpass the 100-point mark since the launch of the survey in January 2001, Wu said, blaming the phenomenon on wage stagnation over the years.
Again, the subindex on stock investment recorded the fastest advance, gaining 7.5 points to 104.8 this month, as institutional players increased positions to cash in on fund inflows following Europe’s quantitative easing initiative, Taiwan Research Institute (台灣綜合研究院) researcher Day Jaw-yang (戴肇洋) said.
Four government funds have invested NT$820 billion (US$26.14 billion) in local shares this year and they might buy another NT$120 billion, encouraged by lucrative returns of 10 percent last year, Day said.
The nation’s stable economy and currency lend support to the local bourse, which might rally past the 10,000-point mark once investors overcome the psychological barrier, he said.
The TAIEX closed down 1.2 percent, or 115 points, to 9,503.72 yesterday, following the overnight decline on Wall Street.
The survey showed that a subindex on the nation’s economic prospects gained 2.05 points to 87.65 this month, the gauge on household income edged up 1.15 points to 83.95 and the subindex on employment picked up 0.25 points to 114.25.
The findings fall in line with the official forecast of a 3.78 percent GDP increase this year and unemployment at a 14-year low, Fu Jen Catholic University Statistics and Information Science Department professor Shia Ben-chang (謝邦昌) said.
“Where there is much room for improvement, the confidence level has shown solid movement in recent months,” Shia said.
The subindex on durable goods consumption fell 1.25 points to 105.05 this month from last month, suggesting property buyers prefer to stay on the sidelines until property tax plans settle, he said.
The inflation subindex printed 51.1, up 0.45 points from the previous month, according to the survey.
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