Confidence in Taiwan's economy weakens in November

11/21/2020 03:52 PM
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CNA photo Nov. 18, 2020
CNA photo Nov. 18, 2020

Taipei, Nov. 21 (CNA) Confidence in Taiwan's economy weakened in November as sentiment was hurt by new waves of COVID-19 infections in the United States and Europe, according to Cathay Financial Holding Co.

Citing a survey conducted from Nov. 1-7, Cathay Financial said 35.3 percent of the respondents believed the economy will improve over the next six months, while 32.2 percent thought it will deteriorate.

The figures translate into an economic optimism index over the next six months of 3.1 in November, down from 9.4 in October amid concerns over an escalating virus spread, which led to new economic lockdowns in many cities, the survey found.

In addition, optimism toward the current economic conditions for November also fell to 8.6 from 12.3 in October, the survey showed.

Amid worries over the pandemic, consumption in the local market has also been depressed to some extent, with the index gauging the willingness to buy big-ticket items, such as homes or cars, over the next six months falling to 2.3 in November from October's 3.4, according to the survey.

The index accessing the willingness to buy durable goods also dropped to minus 14.2 in November, from minus 13.0 in October, according to the survey.

However, Cathay Financial said sentiment toward the local equity market bucked the downturn, showing an improvement in November as the benchmark weighted index on the Taiwan Stock Exchange continued to move in a relatively high range despite the worsening pandemic.

An optimism index on the local equity market rose to minus 2.3 in November, up from minus 3.1 in October, Cathay Financial said. However, an index gauging the willingness to take risks fell to 6.1 in November from 7.6 in October, Cathay Financial added.

In terms of the property market, the survey found 59.1 percent of the respondents expected home prices will move higher by more than 3 percent over the next six months, up 28.4 percentage points from a similar poll conducted in March.

The respondents in the survey pegged Taiwan's 2020 economic growth at 1.5 percent, unchanged from a survey in October, with 84 percent of them saying they expect the annual growth to top 1 percent.

The survey collected 30,496 valid online questionnaires from clients of Cathay Life Insurance and Cathay United Bank, which are fully owned by Cathay Financial.

(By Pan Tzu-yu and Frances Huang)


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