The government’s business climate monitor flashed “blue” for the seventh consecutive month last month, indicating that the economy has yet to come out of the woods, despite earlier projections that things will improve this year, the National Development Council said yesterday.
The council now expects the nation’s export-reliant economy to bottom out this quarter, but global uncertainty lingers.
The total score for the monitoring system stood at 14 last month, one point lower than in November, the council’s report said. Except for ample liquidity, all bellwethers registered negative cyclical movements, the report said.
“The semiconductor industry’s inventory correction has showed signs of stabilization, suggesting that electronics exports may gradually regain growth dynamism going forward,” council researcher Wu Ming-hui (吳明蕙) said.
Taiwan is home to the world’s largest contract chipmakers, chip designers, and chip testing and packing service providers.
The economy may pick up each quarter, although the slowdown in emerging markets, noticeably China, may drag the pace of recovery.
The leading index, which aims to foretell the economic landscape three to six months ahead, printed 98.27 last month, down 0.098 percentage point from one month earlier, the report said.
The finding is consistent with other indicators.
The concurrent economic index stood at 98.54, up 0.03 point from one month earlier.
The gauges on electricity consumption and commercial and retail sales showed positive momentum in line with seasonality trends, the report said.
The advent of the Lunar New Year holidays and the stimulus programs should lend support to consumer spending, Wu said.
The government has provided subsidies for domestic travels and purchases of energy-efficient home appliances and new-generation telecom services.
However, a separate survey showed consumer confidence falling further this month, affected by the stock market’s fall.
The consumer confidence index compiled by National Central University logged 80.89 this month, down 0.72 percentage point from November, the poll showed.
The sub-index on stock investments reported the biggest decline of 2.7 percentage points to 67.7 this month, when the TAIEX once tumbled below the 10-year average amid a global stock rout.
The public also voiced lower interest in durable goods consumption, with the index shedding 1.75 percentage points to 92.9.
Scores below the 100 mark suggest pessimism and values above the threshold indicate optimism.
Only the measure on employment opportunity gained positive momentum to 113.75, up 0.6 percentage point from one month earlier, the report said, thanks to a stable job market.
The survey polled 2,432 adults by telephone between Tuesday and Saturday last week.
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