Consumer confidence slipped this month, ending three months of rebounds, as interest rate and electricity price increases muted the benefits of tax rebates, a survey by National Central University showed yesterday.
The consumer confidence index posted 63.18, down 1.29 points, as inflationary pressure gained traction after the government raised electricity rates this month and the central bank hiked interest rates for the fifth consecutive meeting last month.
That prompted food vendors to raise prices to ease cost burdens, said Dachrahn Wu (吳大任), director of the university’s Research Center for Taiwan Economic Development, which conducted the survey.
Photo: CNA
The interest rate hike increased the cost of borrowing for companies, causing more caution about spending, while sales remain tepid, stretching inventory adjustments and tethering earnings momentum, Wu said.
The price trend countered benefits from a tax rebate of NT$6,000 for eligible individuals, driving the sub-index on consumer prices down by 3.7 points to 26.85, Wu said, adding that the tax rebate helped stimulate private consumption, the main growth driver this year.
People feel less positive about the job market and household incomes, as the sub-indices shed 2.1 points and 1.8 points to 63.9 and 74 respectively, the university’s monthly survey showed.
Public confidence about the economy lost 1.45 points to 79.3, while stock investment interest gained 2 points to 26.7, but remained at a very low level, it said.
Confidence scores of 100 and higher indicate optimism, and values lower than that suggest pessimism.
Wu said he is not surprised about the findings, as exports tumbled by double-digit percentage points in the first quarter of this year and they might not recover until the fourth quarter.
Interest rate hikes by major central banks have curtailed demand for technology products, for which local firms supply critical components, he said.
The gauge on purchases of durable goods, noticeably real estate, held firm by shrinking 0.65 points to 108.35, the survey showed.
The survey polled 2,942 adults by telephone from Tuesday to Friday last week, and had a 2 percent margin of error.
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
MARKET SHIFTS: Exports to the US soared more than 120 percent to almost one quarter, while ASEAN has steadily increased to 18.5 percent on rising tech sales The proportion of Taiwan’s exports directed to China, including Hong Kong, declined by more than 12 percentage points last year compared with its peak in 2020, the Ministry of Finance said on Thursday last week. The decrease reflects the ongoing restructuring of global supply chains, driven by escalating trade tensions between Beijing and Washington. Data compiled by the ministry showed China and Hong Kong accounted for 31.7 percent of Taiwan’s total outbound sales last year, a drop of 12.2 percentage points from a high of 43.9 percent in 2020. In addition to increasing trade conflicts between China and the US, the ministry said
RSS