Taipei-The local consumer confidence index (CCI) for January has been boosted by increased faith in the local equity market, according to the results of a survey released Monday by National Central University (NCU).
Citing the survey, NCU said the January CCI rose 1.64 percent from a month earlier to 87.69, the highest since April 2015, when the index stood at 92.93, on the back of a booming stock market.
The CCI is made up of six sub-indexes that reflect confidence in consumer prices, employment, family finances, the local economic climate, stock market and possible purchase of durable goods over the next six months.
All of the sub-indexes for the six factors moved higher in January with the sub-index for the stock market at 107.00 reaching its highest level since April 2015, when the sub-index for faith in equity prices stood at 109.7, NCU said.
The sub-index for the stock market rose 2.80 from a month earlier, the biggest increase among the six factors, NCU said.
In mid-May, the local main board closed above 10,000 points for the first time in 17 years and continued to rise. On Jan. 23, the weighted index closed at 11,253.11, the highest in almost 28 years. The previous highest closing level was 11,257.23 points on March 21, 1990.
On Monday, the local main board closed up 0.67 percent, at 11,221.81.
Dachrahn Wu (???), director of NCU's Research Center for Taiwan Economic Development, told the press that the improved faith in the stock market has already had spillover effects, boosting family finances and leading to higher private consumption.
Under such favorable circumstances, Wu said, local demand is expected to increase accordingly.
The sub-index for family finances rose 2.25 from a month earlier to 87.20 in January, while the sub-index for local economic climate gained 2.05 from a month earlier to reach 81.75, the survey showed.
Commenting on durable good purchases, Chu Yun-peng (???), a research fellow at the Research Center for Taiwan Economic Development, said property developers in some districts of New Taipei have lowered prices to encourage home buyers to enter the market.
In January, the sub-index for the timing of durable goods purchases rose 1.40 from December to 91.60, while the sub-indexes for employment and consumer prices grew 0.90 and 0.45, respectively, to 106.10 and 52.50, the survey indicated.
Despite the increase in the January CCI, San Gee (??) an economist at NCU, said a stronger Taiwan dollar against the U.S. dollar is expected to compromise Taiwan's exports, and in turn impact the local job market in the future.
According to NCU, a sub-index score of 0-100 indicates pessimism, while a score of 100-200 shows optimism.
In other words, the results show that both the stock market and employment sub-indexes indicate optimism over the next six months, the university said.
The survey, conducted from Jan. 19-22, collected 2,624 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