Consumer confidence weakened further this month, sliding to its lowest level in two-and-a-half years as households grew increasingly uneasy about the economic outlook, job security and big-ticket spending, a survey by the National Central University showed yesterday.
The consumer confidence index fell 1.07 points from last month to 63.31, the weakest number since May 2023, said the university’s Research Center for Taiwan Economic Development (RCTED), which conducts the monthly poll.
“Although the Directorate-General of Budget, Accounting and Statistics recently increased Taiwan’s GDP growth forecast for this year to 4.45 percent, consumer sentiment tells a different story,” RCTED director Dachrahn Wu (吳大任) said.
Photo: CNA
Five of the six sub-indices dropped last month, with only confidence in stock investment showing an improvement.
The measure of household finances over the next six months fell to 75.15, the lowest in more than a year, while the gauge for the nation’s economic outlook slipped to 79.17, the weakest since early 2022.
Expectations for job opportunities also retreated to a 16-month low, underscoring rising concern about income security.
“Once people start to worry about their jobs and income, they are unlikely to spend,” Wu said, adding that private consumption has already shown signs of softening and is unlikely to speed up for the remainder of the year.
The steepest drop came in the durable goods sub-index, which dropped 2.04 points to 94.53 — the lowest since July 2020 at the height of the COVID-19 pandemic. The category includes housing, cars and household appliances.
Demand could improve if Taipei cuts tariffs on US-made vehicles, but such a move remains unlikely in the near term, leaving sentiment subdued, Wu said.
While the government has reiterated that talks with Washington are ongoing, US negotiators have pressed Taipei to lift car tariffs.
Meanwhile, Taiwanese firms face the prospect of unpaid leave or job cuts as they grapple with tariff-related trade barriers threatening their competitiveness, Wu said.
The stock market confidence sub-index rose 2.09 points to 31.2, supported by strong equity performance and expectations of a US Federal Reserve rate cut next month.
However, tariffs would eventually weigh on exports and corporate earnings, casting a shadow over local equities, Wu said.
“Although stock investment confidence has improved, it remains at a very low level,” he said. “Tariffs would eventually weigh on Taiwan’s economic fundamentals and the stock market.”
The survey polled 3,135 adults by telephone from Monday to Thursday last week, with a margin of error of plus or minus 2 percentage points.
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