The nation’s economic monitoring indicators flashed “red” last month for the third straight month on the back of solid economic recovery, with consumer confidence rising to its highest level in nearly six years.
The Council for Economic Planning and Development (CEPD) said that as prospects for industrial production, trade and consumption continued to improve, the headline indicator gained one point to 39 last month, up from 38 in February.
The council’s report showed that among the index’s nine components, retail and food services sales turned “red,” indicating “overheating,” after flashing “yellow-red” in February.
“The economy has shown clear signs of a steady and moderate recovery,” CEPD Vice Chairman Hu Chung-ying (胡仲英) told reporters. “It can be said that the economy has entered into the stage of expansion and returned to pre-crisis levels.”
Council data showed that the sub-indexes of industrial production, sales of wholesale, retail and food services, and imports of machinery and electrical equipment were higher than the pre-crisis levels.
The unemployment rate remained high, however, and would be a drag on domestic consumption, Hu said.
Still, the job market was recovering at a moderate pace, with non-agricultural employment flashing “green” for the second consecutive month last month, the council said.
The recovering economy also boosted this month’s consumer confidence index, which rose for the eighth consecutive month to 78.68 points, up 4.35 points from the 74.33 recorded last month, the latest survey released by National Central University showed.
The school’s Research Center for Taiwan Economic Development said in the report that public expectations about the economy in the next half year saw the strongest improvement in all categories.
The sub-index on the economic outlook rose to 80.8 points, up from 67.65 last month, the report said, adding that more than 50 percent of respondents said the economy would improve or remain at current levels in the near future.
“It is clear that the public remained optimistic [about the economy] following strong growth in industrial production and export orders,” center director Hsu Chih-chiang (徐之強) said by telephone.
Public confidence about consumer prices, household financial conditions and the job market in the near term all strengthened this month, except for the outlook for stock investment, he said.
“As the central bank continued to absorb excess liquidity in the market, investors appeared to be more conservative,” Hsu said.
Soaring housing prices also made consumers hesitant about purchasing durable goods. Nearly 60 percent of respondents didn’t think the next six months would be a good time to buy durable goods such as houses, the survey said.
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