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Economic sentiment weakening: survey

Economic sentiment weakening: survey

Taipei, July 17 (CNA) Economic sentiment continued to weaken in July after a flurry of disappointing economic data, in particular regarding the country's exports, which serve as the backbone of Taiwan's economic growth, a survey showed Friday. Cited in the survey, Cathay Financial Holding Co. (???) said that several international organizations have lowered their forecasts for the world's economic growth for 2015, dealing another blow to Taiwan's economic sentiment. Concerns over the debt problems in Greece also hurt local economic sentiment, Cathay Financial said. The survey, which collected 19,331 valid responses from its customers, was conducted between July 1 and July 10 before the Greek parliament passed a bailout agreement Wednesday. According to the survey, 26 percent of the respondents said they expect the local economy to improve over the next six months, while 36.5 percent anticipated that the local economy will decline over that period. The figures translate into an economic optimism index for July of minus 10.5, down from minus 7.6 recorded in June. The June figure fell from 14.4 seen in May. Cathay Financial said that recent export data has dampened local sentiment. In June, Taiwan's exports fell 13.9 percent from a year earlier, marking the fifth consecutive month of year-on-year contraction at a time when the global high-tech industry was continuing with inventory adjustments. Among the cautious international institutions, the International Monetary Fund has cut its forecast of the global gross domestic product (GDP) growth to 3.3 percent from its earlier estimate of 3.5 percent. Cathay Financial said that although China -- the world's second- largest economy, reported a 7 percent increase in its second quarter GDP, higher than an earlier market estimate of 6.8 percent, concerns remained over the country's domestic demand for the year. Under such unfavorable circumstances, Cathay Financial said, investors became more cautious toward the local equity market. The survey results show that 39.7 percent of the respondents said they expect local share prices to fall over the next six months, while 22.9 percent predicted that the stock index will rise. The figure represents a July stock market optimism index of minus 16.8, but compared with minus 16 recorded a month earlier, the drop seemed limited, Cathay Financial said. (By Tien Yu-pin and Frances Huang)


Updated : 2021-09-28 15:06 GMT+08:00