Taiwanese sentiment toward the economy turned sharply pessimistic this month, as concerns over US “reciprocal” tariffs weighed on consumer confidence, cooled investment interest and softened home-buying enthusiasm, a survey released yesterday by Cathay Financial Holding Co (國泰金控) showed.
The latest results showed a steep deterioration in public perceptions of both the current and future economic outlook.
The index measuring views on the current economic situation plunged to minus-44.5, while the outlook index fell to minus-41.3, both registering steep declines, Cathay Financial said.
Photo: RITCHIE B. TONGO, EPA-EFE
Consumer sentiment has clearly deteriorated, with the index for durable goods consumption falling to minus-18.3, the willingness to sell homes sliding to minus-20.3 and home-buying intention diving to minus-50.3, the survey found.
Respondents also adopted a more cautious outlook on GDP growth and inflation for the year, the company said.
On average, the public expects GDP growth of 2.63 percent, with 62 percent of respondents predicting the final figure would fall below 3 percent.
While the Directorate-General of Budget, Accounting and Statistics (DGBAS) in February forecast 3.14 percent GDP growth for this year, the National Development Council last week said that the economy could shrink by as much as 1.61 percent — bringing growth down to just 1.53 percent — due to the potential impact of looming US tariffs.
Meanwhile, the public expects consumer prices to rise by 2.33 percent — higher than the DGBAS’ forecast of 1.94 percent — with about 70 percent of respondents anticipating inflation to exceed the 2 percent mark, the survey showed.
Stock investors also shared the bleak sentiment, weighed down by concerns over a potential global economic slowdown, Cathay Financial said.
The index measuring views on the local stock market dropped to minus-23.3, while the risk appetite index edged down to 3.4, reflecting growing caution among individual investors.
Adding to the pessimism, 55 percent of respondents reported that housing prices in their area had risen by 3 percent over the past six months. Nearly half — 48 percent — expect a similar increase in the next six months, although most agreed the housing market had shown signs of slowdown, the survey found.
The survey showed that consumers and investors are bracing for a tougher environment marked by slowing economic growth, rising inflation and greater market volatility amid ongoing geopolitical tensions and global trade uncertainty, Cathay Financial said.
The survey was conducted from April 1 to 7 and gathered 13,693 valid online responses from clients of Cathay Life Insurance Co (國泰人壽) and Cathay United Bank Co (國泰世華銀行), both wholly owned subsidiaries of Cathay Financial.
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