The consumer confidence index (CCI) edged up this month, driven by economic improvement, although stock investment confidence dropped amid market volatility, a National Central University (NCU) survey released yesterday showed.
The private consumption measure rose 0.91 points to 83.47 this month, rising for two months in a row, as people have become more positive about the economy, household income and durable goods consumption, the monthly survey found.
Dachrahn Wu (吳大任), director of the NCU Research Center for Taiwan Economic Development, which conducts the survey, said the increase in confidence has much to do with economic improvement in the US, the world’s main market for consumer electronics.
The sub-index for consumer prices reported the biggest advance of 2.65 points to 47.05 this month, on the back of oil and raw material price hikes, the survey said.
“The public might feel only part of the pinch, as the government has introduced a progressive mechanism to mitigate the pain,” Wu said.
The public also has more confidence in the economy with the economic outlook sub-index increasing by 2 points to 82.7 this month, the data showed.
A strong US economy would benefit Taiwan’s exports, as local firms supply electronic components used in smartphones, laptops and TVs, as well as Internet of Things and artificial intelligence applications, Wu said.
The sub-index on household income rose 1.5 points to 87.4 this month, while the job market outlook reading gained 1.1 points to 102.0, it said.
The confidence level would have been higher if the government had not introduced pension reforms that cut stipends for retired civil servants, public-school teachers and military personnel, Wu said.
People demonstrated more confidence in purchasing durable goods — mainly property — with the sub-index picking up 1.4 points to 91.15 this month, it said.
However, the public was less upbeat about stock investment, with the sub-index losing 3.2 points to 90.5, it said.
A healthy dose of caution would be good for investors, as the TAIEX has moved relatively high, increasing the chance of corrections, Wu said, adding that the trade war between the US and China is adding force to fluctuations across global bourses.
A sub-index score of between zero and 100 indicates pessimism, while a score of between 100 and 200 indicates optimism.
The confidence survey polled 2,729 adults by telephone from Wednesday last week to Sunday. It had a margin of error of 2 percentage points.
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