TAIPEI: Public confidence remains low, but climbed to a nine-month high this month, reflecting the nation’s sluggish economy, but signaling that expectations of recovery from this quarter onward are growing, a Cathay Financial Holding Co survey showed yesterday.
About 36 percent of respondents expect the economy to deteriorate in the coming six months, outnumbering people with neutral views (30.3 percent) and those expecting an upturn (25 percent), the survey found.
“The confidence level this month is the highest since August last year and represents a seventh consecutive month of uptick, despite the slow pace of the rise,” Cathay Financial economic research department assistant manager Achilles Chen said.
The findings came after central banks in Taiwan, Europe and elsewhere last month adopted further loose monetary measures to support economic growth and succeeded in boosting global bourses.
The TAIEX shed 0.4 percent to 8,666.01 yesterday, but recoveries and wild swings were seen in the beginning of the year, Chen said.
Most research institutes forecast a GDP decline for Taiwan last quarter and expect a slow, but gradual recovery from this quarter on, in line with the technology product cycle.
Against that backdrop, some people are expressing a better appetite for risk and willingness to buy durable goods and big-ticket items, the survey said.
About 16 percent of respondents said they planned to raise their budgets for durable goods in the next six months, while 24.8 percent intend to acquire big-ticket items, according to the survey.
In addition, 17.9 percent aim to convert cash positions into equity holdings, although 43.2 percent expect the main trading index to move down from the current level going forward, the survey said.
The sentiment improvement extends to the real-estate market as a few more people think it is wise to buy houses now, but fewer people are willing to sell, the survey said.
Still, a large majority, 72.4 percent believe it is ill-advised to buy houses now and 61.9 percent think it is not wise to sell either, the survey said.
The findings suggest an extended soft patch for housing transactions in coming months, although the central bank last month eased mortgage restrictions for homes in Greater Taipei.
The central bank’s measured moves might drag out the pricing tug-of-war as sellers might show less flexibility while buyers stand by expectations of price falls, analysts have said.
The survey found 65.5 percent of respondents expect income levels to hold steady in the next six months, while 16.4 percent are looking at an increase and 18.1 percent voiced concerns over a pay cut.
“The figures signify resilient private consumption amid tepid external demand,” Chen said.
The survey polled 21,208 Cathay Financial clients via the Internet from April 1 to April 7.
