Business confidence last month moved up slightly for all sectors, as business visibility brightened a bit, but the low season limited the pace of improvement, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) said yesterday.
The sentiment gauge for local manufacturers printed 98.67, up 0.35 points from a revised 98.32 in March, meriting a neutral interpretation given the insignificant change, TIER said.
The number of firms that are positive about their business prospects in the coming six months shed 5.5 percentage points from 40.1 percent to 34.6 percent, while firms with a negative outlook declined 2.5 percentage points from 12.5 percent to 10 percent, and the remaining firms expected no change, it said.
Photo: CNA
Taiwanese tech firms have benefited from strong demand for electronics used in artificial intelligence, but other sectors have not come out of a global slowdown induced by sticky inflation and tight monetary policy, TIER said.
Manufacturers of electrical and machinery equipment see favorable times ahead, but suppliers of base metal and chemical products expect things to remain the same, it said.
Healthy economic data in the US would prompt the US Federal Reserve to hold onto current restrictive monetary policy and curb demand for commodities, TIER said, adding that persisting geopolitical tensions in the Middle East and Europe are increasing economic uncertainty.
That explained why shipments of information communication technology products were the only bright spot last month, with a growth of more than twofold, while all other categories faltered into contraction, the Ministry of Finance said earlier this month.
The confidence of service providers edged up 0.65 points from a revised 95.05 to 95.7, as people turned cautious after the April 3 earthquake in Hualien, which measured a 7.2 on the Richter scale, and food safety incidents, TIER said.
Fast and deep retreats at the local bourse in the middle of last month weighed on the wealth effect, it said. The conservative patch did not last long, as the TAIEX bounced back late that month and has repeatedly hit record highs this month.
Retailers, hospitality providers, banks, life insurers and securities houses are looking at a business upturn going forward, thanks to the advent of the summer vacation, but wholesale firms believe things would likely be steady, TIER said.
The confidence reading for construction firms and real-estate brokers gained 4.24 points from 103.15 to 107.39, ending two months of declines, it said.
The uptick had to do with an ongoing pickup in housing transactions and the government’s implementation of a public works budget, it added.
The new administration has pledged to speed up reconstruction in Hualien and would introduce programs to shore up strategic industrial sectors, which would be favorable for construction and real-estate firms, TIER said.
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