Taiwan Economic Sentiment Weakens

Sentiment toward Taiwan’s economy continued to weaken in June as concern about the outlook for the local job market increases, according to a survey conducted by Cathay Financial Holding Co.

Citing the poll, Cathay Financial, one of the leading financial holding companies in Taiwan, said cautious sentiment toward the job market offset an improving composite index of monitoring indicators for April released by the National Development Council, signaling a “green light”, which pointed to steady growth, for the third consecutive month, CNA reported.

In the survey, about 19% of respondents agreed the economy improved from six months earlier, while 47.1% said the economy had fared worse than six month earlier.

The figures translated into an economic optimism index for the economy of minus 28.1, the lowest level in 17 months, down from minus 26.7 seen in a similar poll conducted in May. It was the fourth consecutive month the index has moved lower.

In addition, the economic optimism index on the economic outlook for the next six months fell from minus 27.8 in May to minus 29.6 in June, the lowest in 30 months, the survey found.

The weakening sentiment toward the local economy came after the optimism index for the local job market now and over the next six months fell from minus 27.9 and minus 31.8 respectively in May to minus 31.1 and minus 35.3 in June, Cathay Financial said.

The minus 31.1 was the lowest level in 10 months, and the minus 35.3 the lowest in 16 months, Cathay Financial added.

It said caution over the job market also pushed down expectations of wage hikes over the next six months with the relevant index falling from minus 2.0 in May to minus 2.1 in June, ending a five month rising streak.