The government’s business climate monitor last month remained “green” thanks to more working days, but consumer confidence retreated this month as the COVID-19 pandemic escalated, the National Development Council said yesterday.
The healthy readings had much to do with the timing of the Lunar New Year, but still reflected the fast-evolving economic effects of the pandemic, NDC research director Wu Ming-huei (吳明蕙) told a media briefing in Taipei.
“There is no room for optimism as the virus spreads quickly in Europe and the US, where self-isolation requirements are freezing demand for nonessential products and services,” Wu said.
The development is worrying and much more serious than previous concerns over potential supply disruptions in China, Wu said.
Major economic barometers would take a hit this month, although the effect was not evident last month, Wu added.
The total score for constituent monitors was 24, 1 point lower from last month, the council said.
The council uses a five-color scheme to gauge the state of the economy, with “green” indicating steady growth, “red” suggesting overheating and “blue” signaling a recession. Dual colors indicate a transition.
Low comparison bars last year allowed exports, industrial output, share prices, and wholesale and retail sales to post positive cyclical movements last month, Wu said.
The leading indicator, which predicts the economic situation in the coming six months, pointed to an opposite direction, shedding another 0.16 percent to 101.33 for the fourth month in a row, the NDC said.
The coincident indicators, which reflect the current economic situation, grew 0.21 percent to 101.2, aided by stronger power consumption, manufacturing sales and industrial production, it said.
Public and service-oriented companies are already feeling the effects of the pandemic.
The consumer confidence index this month fell 5.42 points to 78.51, a National Central University survey showed.
The sentiment on stock investment retreated 11.8 points to 53.7, the weakest since February 2013, it said, as foreign institutional players aggressively slashed local share holdings.
The buying interest gauge of durable goods lost 6.6 points to 104.45, suggesting that people are less likely to purchase real estate, it said.
People also expect a downturn in household income, GDP growth and job opportunities going forward, it said.
The survey interviewed 2,795 Taiwanese adults by telephone between Thursday last week and Monday, with a margin of error of 2 percentage points.
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