Sat, Mar 28, 2026 page9

• Consumer confidence at lowest level in 3 years

  HEIGHTENED CONCERNS: A survey by National Central University showed that consumer concerns are linked to uncertainty caused by the war in Iran

  • By Crystal Hsu / Staff reporter
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  Taiwan’s consumer confidence declined this month as escalating tensions in the Middle East weighed on sentiment and heightened concerns over inflation and economic risks, a survey released yesterday by National Central University (NCU) said.

  The consumer confidence index dropped 4.28 points from the previous month to 62.3, the lowest level in three years and two months, the survey showed.

  All six sub-indicators dropped, including expectations for prices, household finances, the domestic economic outlook, employment opportunities, stock investment interest and purchases of durable goods.

  

  A customer buys eggs at a store in Taipei’s Beitou District on Sept. 22 last year.

  Photo: CNA

  The retreat in sentiment reflects growing uncertainty linked to the ongoing conflict in the Middle East, which has raised concerns about global energy supplies and inflation pressures, the monthly survey said.

  NCU Research Center for Taiwan Economic Development director Dachrahn Wu (吳大任) said that Taiwan is particularly vulnerable to energy disruptions, as about 95 percent of its energy supply is imported.

  If the conflict drags on and affects shipping routes, inflation would be the most immediate risk, followed by broader economic repercussions, Wu said.

  “The key concern lies in the security of the Strait of Hormuz, a critical corridor for global oil shipments. Even if military hostilities end soon, supply risks could persist for six months to a year,” he said.

  Since many Asian economies — including Taiwan, Japan, South Korea and Vietnam — rely heavily on energy shipments passing through the waterway, any disruption could keep global oil prices elevated and intensify inflationary pressure across the region, Wu said.

  Although the government has introduced measures to stabilize energy prices, those policies would delay inflation rather than resolve it altogether, Wu said. As a result, weak consumer sentiment could persist for some time.

  Another potential consequence is slower economic activity if higher prices squeeze household budgets, he said. Rising living costs could crowd out spending on leisure and dining out.

  If the conflict pushes up prices globally, it could also weigh on consumer spending in the US and other major economies. That could eventually reduce demand for artificial intelligence (AI) applications and equipment such as AI servers, undermining Taiwan’s technology supply chain, Wu said.

  Among the index components, sentiment toward stock investment posted the steepest decline. The sub-index measuring interest in investing in stocks over the next six months fell 5.58 points to 22.88, a three-year-and-two-month low.

  The TAIEX remains at elevated levels despite pullbacks and shrinking trading volumes, Wu said, warning that “high valuations themselves pose a risk.”

  Meanwhile, the sub-index tracking willingness to purchase durable goods in the next six months fell 4.11 points to 93.01, marking a five-month low.

  However, inflation concerns and the central bank’s easing of second-home mortgage restrictions could prompt investors to seek refuge in property, potentially helping the housing market recover, the survey said.
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