Confidence in local economy improves in September

Taipei,  Faith in the local economy improved in September amid eased concerns over the COVID-19 pandemic, Cathay Financial Holding Co. said on Monday, citing the results of a survey.

Cathay Financial said the recovering confidence also came after the National Development Council reported in late August that the country’s economic leading indicators, which gauge the economic climate over the next three to six months, moved higher for the fourth straight month in July.

According to Cathay Financial, the survey, conducted Sept. 1-7, found that 36.6 percent of the respondents agreed that the economy will improve over the next six months, while 33.5 percent said the economy will deteriorate.

The figures translate into an economic optimism index over the next six months of 3.1 in September, up from 1.9 in August, Cathay Financial said.

The optimism toward the current economic conditions also rose to 5.6 in September from 2.9 in August, the poll showed.

Meanwhile, the index assessing the expectations that wages will move higher over the next six months stood at minus 3.3 in September, up from minus 6 in August, the survey found.

However, the index gauging the willingness to buy big-ticket items such as cars and homes fell to minus 0.3 in September from 1.1 in August, while the index assessing the willingness to buy durable goods also dropped to minus 17.1 from minus 15.2, the survey showed.

Amid continued tension between the United States and China, an optimism index on the local equity market fell to minus 3.8 in September from August’s minus 2.5, but the index gauging the willingness of investors to take risks rose to 6.7 from 4.7, Cathay Financial said.

The respondents pegged Taiwan’s 2020 economic growth at 1.4 percent, unchanged from a similar survey in August, with 85 percent saying they expect the annual growth to top 1 percent.

The survey results indicated a more cautious mood than that of the government, as the Directorate General of Budget, Accounting and Statistics in mid-August downgraded its forecast for Taiwan’s economic growth for 2020 to 1.56 percent from an estimate of 1.67 percent made in May.

The survey collected 18,666 valid online questionnaires from clients of Cathay Life Insurance and Cathay United Bank, which are fully owned by Cathay Financial.

 

Source: Focus Taiwan News Channel

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