Taipei, Consumer confidence in Taiwan weakened in May for the fourth consecutive month, amid the COVID-19 coronavirus pandemic, with confidence in equity investments falling to a new low, National Central University (NCU) said Wednesday.
Citing a survey it conducted May 18-20, NCU said the consumer confidence index (CCI) for May fell 8.52 points from a month earlier to 64.87, the lowest level since November 2009, when it stood at 62.47.
Dachrahn Wu (吳大任), director of NCU’s Research Center for Taiwan Economic Development, said that with the unemployment rate in Taiwan now over 4 percent and an increasing number of workers on unpaid leave due to the pandemic, domestic consumers have become more cautious about the economy.
The CCI reflects public confidence over the next six months in the areas of employment, family finances, consumer prices, the local economic climate, the stock market, and the likelihood of purchasing durable goods.
The NCU survey showed that in the sub-index on stock investments, public confidence fell 7.2 in May from a month earlier to 36.9, the lowest since the university began reporting on the CCI in January 2001.
Wu said although the weighted index on the Taiwan Stock Exchange has held above 11,000 points since early April as Taiwan has managed to contain the virus, equity investor sentiment remained bothered by the spread of the disease in the United States and Europe.
He expressed the view that many investors in Taiwan are locking in their profits at the moment due to the economic uncertainty amid the pandemic.
According to the NCU survey, the CCI fell in May in all the other sub-indexes, with family finances, employment, durable goods purchases, the economic climate, and consumer prices down from a month earlier at 78.05, 71.5, 88.45, 79.05 and 35.25, respectively.
A sub-index score of 0-100 indicates pessimism, while a score of 100-200 shows optimism, according to NCU.
Wu said although Taiwan’s service sector has been recovering as the country has reported zero COVID-19 cases in recent days, the export-oriented manufacturing sector is likely to continue to suffer due to falling global demand.
The effects of COVID-19 on Taiwan’s economy are expected to last throughout the year, he said.
The NCU survey collected 2,840 valid questionnaires from local consumers aged 20 and over. It had a confidence level of 95 percent and a margin of error of plus or minus 2.0 percentage points.
Source: Focus Taiwan News Channel