Public confidence in the economy slid further last month, amid concern that the nation’s export-oriented economy would fall prey to the rapidly escalating COVID-19 pandemic, Cathay Financial Holding Co (國泰金控) said yesterday.
A total of 87 percent of respondents thought the economic situation had deteriorated from six months ago, compared with 70 perfect a month earlier, according to Cathay Financial’s latest poll, which surveyed 17,393 of its clients in the first week of this month.
“That Taiwan has been doing well in combating the pandemic, with a relatively small number of confirmed cases, does not seem to have soothed people’s worries,” Cathay Financial economic research division director Nelson Chen (陳志祿) told the Taipei Times by telephone.
Chen attributed it to the rising number of infections in the US and Europe, which has rattled the public, as they know Taiwan is largely dependent on exports and collaborations with foreign suppliers.
The survey also showed that 68.7 percent of respondents expect to see a downturn in the nation’s economy in the next six months, up slightly from 65.2 percent a month earlier, Chen said.
Amid the gloomy outlook, 36.2 percent expected their salary to drop, compared with 26.6 percent a month earlier, while 53.9 percent expressed little interest in making big purchases, up from 43.6 percent the previous month, Chen said.
Meanwhile, 79.4 percent thought the job market had worsened and 67 percent expected the situation to remain bleak in the next six months, compared with 57.4 percent and 55.5 percent respectively a month earlier, the poll showed.
However, people have become slightly more upbeat about the local equity market, with 23.3 percent expecting the TAIEX to rally over the next six months, compared with 18.8 percent a month earlier, while 58.3 percent projected the index would fall, down from last month’s 60 percent, the poll showed.
Market sentiment toward local equities might have been boosted by the government activating the National Stabilization Fund to support the market since the middle of last month, Chen said.
However, most respondents, or 41.8 percent, said they still preferred holding cash to buying stock, as a hedge against uncertainty in financial markets, he said.
“Overall, we forecast that the COVID-19 crisis would continue to weigh on local investors until the infection curve flattens worldwide. However, it is hard to foresee the exact timing,” Chen said.
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