Consumer confidence rebounded slightly this month due mainly to the short-term effects of the Lunar New Year holiday after four consecutive months of declines, National Central University said in a report yesterday.
The consumer confidence index (CCI) rose 0.61 points from a month earlier to 59.73, the report said.
The index fell to 59.12 last month, its lowest level since reaching 56.45 in September 2009, when the economy was recovering from the 2008-2009 global financial crisis.
Photo: CNA
The index’s all-time low was 48.42 in February 2009 at the height of the crisis.
The CCI gauges people’s confidence toward durable goods purchases, the local economic outlook, household finances, employment prospects, the stock market and consumer price fluctuations over the next six months, the report said.
The report — which polled 2,900 people older than 20 from Jan. 18 to Jan. 20 — showed improvements in all sub-indices except for confidence in consumer prices.
In this month’s survey, confidence in the economic outlook over the next six months rose the most, gaining 1.25 points from a month earlier to 76.85, while the sub-index for family finances moved 0.85 points higher to 71.75.
Although the overall CCI and the sub-indices largely showed improvement, it was too early to say that the economy has taken a turn for the better, said Dachrahn Wu (吳大任), director of the university’s Research Center for Taiwan Economic Development.
The improved confidence among Taiwanese might have come from higher spending in preparation for the Lunar New Year holiday from Jan. 20 to Sunday, creating a short-term pickup in domestic demand, he said.
However, with inflation and aggressive interest rate hikes by the US Federal Reserve last year weighing on demand worldwide, Taiwan’s exports could be further affected this year, which would erode confidence in family finances and investment in the near term, he said.
While the Fed has slowed its interest rate hikes, consumer demand would not rebound until it starts cutting rates, he said.
“Taiwan’s exports will face more serious challenges, and it would not be easy for Taiwan’s economy to perform well in the first half of this year. We have to wait for the US to adjust its monetary policy,” Wu said.
The sub-index for durable goods purchases rose 0.7 points from a month earlier to 100.6, edging above the 100 point threshold that divides pessimism and optimism, the survey showed.
A separate index that gauges the timing on buying a home, jointly compiled by the university and Taiwan Realty Co (台灣房屋), rose by 0.6 points to 101 this month.
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