The consumer confidence index (CCI) showed a modest increase this month as people are becoming more optimistic about stock investments and household income amid recent rallies on the local bourse, a survey released yesterday by National Central University (NCU) showed.
The CCI for this month stands at 85.33 points, adding 0.97 points from last month to reach the highest level in 11 months, with most sub-indices picking up, the monthly report said.
The gauge on stock investment gained 1.5 points to 96.4, it said, as the TAIEX has increased 2.8 percent so far this month — reaching 10,939.06 points yesterday — with a healthy turnover of more than NT$100 billion (US$3.24 billion) a day.
Movements in the local benchmark have a considerable influence on consumer confidence readings, as retail investors account for more than 60 percent of the local market, whereas portfolio managers dominate bourses elsewhere.
The survey showed that rising share prices have helped galvanize public confidence, with the economic outlook climbing 1.3 points to 85.3 — the highest since June 2015.
The improvement in sentiment bucks a continued retreat in major economic barometers, but falls in line with easing declines.
Major think tanks in Taiwan have trimmed forecasts for GDP growth this year down to nearly 2 percent after exports began to weaken at a faster pace than expected. Ongoing trade tensions and geopolitical uncertainty have weighed on the business of local firms in supply chains of global technology brands.
However, the gauge on household incomes gained 1.05 points to 90 — the highest since August 2015 — thanks to the effect of positive wealth, it said.
Better income expectations are increasing interest in the purchase of durable goods, with the sub-index rising 1.1 points to 92.1, it said.
The figure is a favorable sign for property transactions, as they constitute a big chunk of durable goods sales.
The gauge on consumer prices registered 48.2 points, up 1.45 points from last month, which suggests a lingering discontent with local consumer prices.
The gauge on employment opportunities over the next six months shed 0.65 points to 100, but remains at a relatively high level, the survey said, as few firms have cut payrolls amid the economic slowdown.
Confidence values of more than 100 points indicate upbeat sentiment and scores below the threshold suggest pessimism.
The university carried out the survey on behalf of the government, polling 2,693 adults by telephone from April 19 to Tuesday last week.
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