The confidence of entrepreneurs in all sectors increases slightly

• By Crystal Hsu / Staff Reporter

Business sentiment rose slightly across sectors last month as business visibility improved slightly, but the low season limited the pace of improvement, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) said yesterday.

The local manufacturer sentiment index was 98.67, up 0.35 points from the revised level of 98.32 in March, which deserves a neutral interpretation given the insignificant change, TIER said.

The number of companies with a positive outlook on their business prospects over the next six months fell by 5.5 percentage points from 40.1% to 34.6%, while those with a negative outlook dropped by 2.5 percentage points from 12.5% ​​to 10%, and the remaining companies did not expect it to change, he said.

Photo: CNA

Taiwanese technology companies have benefited from strong demand for electronics used in artificial intelligence, but other sectors have failed to recover from a global slowdown caused by persistent inflation and tight monetary policy, says TIER.

Manufacturers of electrical and machinery equipment see favorable times ahead, but suppliers of base metals and chemical products expect the situation to remain unchanged, he said.

Strong U.S. economic data would prompt the U.S. Federal Reserve to maintain its current tight monetary policy and reduce demand for goods, TIER said, adding that persistent geopolitical tensions in the Middle East and Europe are increasing economic uncertainty.

This explains why shipments of information and communication technology products were the only bright spot last month, recording a more than doubling increase while all other categories declined, the Ministry of Finance said earlier this month.

Confidence in service providers rose 0.65 points from a revised 95.05 to 95.7 as people became cautious following the April 3 magnitude 7.2 Hualien earthquake and food safety incidents, it said TIER.

The rapid and deep decline in the local stock market in the middle of last month took a toll on the wealth effect, he said. The conservative improvement did not last long as TAIEX rebounded later that month and reached record highs multiple times this month.

Retailers, hospitality providers, banks, life insurers and securities houses expect business to pick up in the future thanks to the arrival of the holidays, but wholesale companies believe the situation is likely to remain stable, says TIER.

The confidence index for construction companies and real estate agents rose by 4.24 points from 103.15 to 107.39, ending two months of declines.

He added that this increase is due to the continuous increase in the number of housing transactions and the government’s implementation of the public works budget.

The new administration has pledged to accelerate reconstruction in Hualien and will introduce programs to support strategic industrial sectors, which would benefit construction and real estate companies, TIER said.