Consumer confidence weakened to 78.36 this month, its lowest in two-and-a-half years, as disappointing economic data led people to adopt a pessimistic outlook on stock investments, a survey by National Central University showed yesterday.
The latest consumer confidence index represented a decline of 1.46 points from last month, with all six sub-indices retreating, the monthly survey found.
The sub-index on stock investments showed the biggest decline, falling 6.5 points to 61.2 this month as uneasy sentiment built up after research institutes cut global and national GDP growth forecasts for this year, said Dachrahn Wu (吳大任), a professor of economics and director of the university’s Research Center for Taiwan Economic Development, which conducted the survey.
The survey, which polled 2,424 people between Sunday and Wednesday last week, has yet to factor in Britain’s vote on Thursday to leave the EU, Wu said, adding that the confidence level could drop lower as global financial markets factor in the impact.
Market volatility bodes ill for growth outlook everywhere, as consumers tend to restrict spending in times of uncertainty, Wu said.
Private consumption is needed to support GDP growth in Taiwan this year, as exports are expected to stall due to a persistent global slowdown and a lack of technological innovations, he said.
The confidence data and recent economic and financial events lend support to conservatism, Wu said.
The sub-index on durable goods consumption printed 89.55, down 0.55 points from last month, while the gauge on household income shed 0.4 points to 78.45, the survey found.
That means people expect to have less income going forward and will tend to refrain from buying real estate, home appliances and cars, the survey said.
The inflation sub-index fell from 56.65 to 55.85, while the measure on economic outlook softened from 73.05 to 73, according to the survey, consistent with the sluggish economy and the gradual rise in crude oil prices.
The index on the employment outlook saw a decline of 0.45 points to 112.1, but remains above the neutral threshold of 100.
Scores above 100 indicate optimism and points below that suggest pessimism.
Wu said there is no need for the central bank to cut interest rates on Thursday to stimulate growth, as cuts have proven ineffective for the past six months.
Lower interest rates might prompt capital outflows, which is unfavorable for the stability of the TAIEX and for consumer confidence, Wu said.
PERSISTENT RUMORS: Nvidia’s CEO said the firm is not in talks to sell AI chips to China, but he would welcome a change in US policy barring the activity Nvidia Corp CEO Jensen Huang (黃仁勳) said his company is not in discussions to sell its Blackwell artificial intelligence (AI) chips to Chinese firms, waving off speculation it is trying to engineer a return to the world’s largest semiconductor market. Huang, who arrived in Taiwan yesterday ahead of meetings with longtime partner Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), took the opportunity to clarify recent comments about the US-China AI race. The Nvidia head caused a stir in an interview this week with the Financial Times, in which he was quoted as saying “China will win” the AI race. Huang yesterday said
Nissan Motor Co has agreed to sell its global headquarters in Yokohama for ￥97 billion (US$630 million) to a group sponsored by Taiwanese autoparts maker Minth Group (敏實集團), as the struggling automaker seeks to shore up its financial position. The acquisition is led by a special purchase company managed by KJR Management Ltd, a Japanese real-estate unit of private equity giant KKR & Co, people familiar with the matter said. KJR said it would act as asset manager together with Mizuho Real Estate Management Co. Nissan is undergoing a broad cost-cutting campaign by eliminating jobs and shuttering plants as it grapples
The Chinese government has issued guidance requiring new data center projects that have received any state funds to only use domestically made artificial intelligence (AI) chips, two sources familiar with the matter told Reuters. In recent weeks, Chinese regulatory authorities have ordered such data centers that are less than 30 percent complete to remove all installed foreign chips, or cancel plans to purchase them, while projects in a more advanced stage would be decided on a case-by-case basis, the sources said. The move could represent one of China’s most aggressive steps yet to eliminate foreign technology from its critical infrastructure amid a
MORE WEIGHT: The national weighting was raised in one index while holding steady in two others, while several companies rose or fell in prominence MSCI Inc, a global index provider, has raised Taiwan’s weighting in one of its major indices and left the country’s weighting unchanged in two other indices after a regular index review. In a statement released on Thursday, MSCI said it has upgraded Taiwan’s weighting in the MSCI All-Country World Index by 0.02 percentage points to 2.25 percent, while maintaining the weighting in the MSCI Emerging Markets Index, the most closely watched by foreign institutional investors, at 20.46 percent. Additionally, the index provider has left Taiwan’s weighting in the MSCI All-Country Asia ex-Japan Index unchanged at 23.15 percent. The latest index adjustments are to
RSS