TAIPEI: Taiwan's consumer confidence index (CCI) has climbed back to where it was in July last year - before the onset of the global economic crisis, according to a survey of the National Central University (NCU).

July's CCI climbed 4.74 points from June to 56.18 - the highest of the past twelve months, said the Research Center for Taiwan Economic Development of NCU in a press release issued yesterday.

The CCI over recent months has shown signs of bottoming-out. It's still too early to declare a full recovery. The CCI will have to rise above 60 to achieve that milestone, said Chia Be-chang, a statistics professor at Fu Jen Catholic University.

Taiwan's CCI has been sinking since last May, reaching a low point in February this year. An upward trend started in March, though there was a slip in June, according to the center's records.

The Research Center for Taiwan Economic Development of NCU has been gauging Taiwan's CCI every month since 2001. More than 2,300 people over the age of 20 were polled in telephone interviews between July 19-22. The polling was conducted by the Department of Statistics and Information Science of Fu Jen Catholic University.

Five of the six sub-indices of the CCI also went up in July.

The biggest rise was registered in the stock investment sub-index, which advanced from last month's 58.4 to 82 in July. Twenty-nine percent of those polled saw the next six months as a good time to buy stocks, significantly higher than the 15.4 percent recorded in June.

Chia attributed the swelling confidence to recent gains in the stock market.

Taiwan's main TAIEX share index finished up 114.20 points at 7,142.63 yesterday, its strongest close since August 15 last year.

Also robust is the sub-index revealing intent to buy durable goods. The number of people saying they intended to buy durables over the next half year increased, raising the sub-index to 82.5 points.

Three other sub-indices on the state of the economy, household finances and price level also edged up.

However, the gloom persisted on the job front. Fewer people felt optimistic about job opportunities in the next six months, lowering the sub-index by 1.85 points to 33.1.

As college graduates join the job market over the summer, the unemployment situation is expected to deteriorate in the coming months. Even if the jobless figure improves after September, without the seasonal factor, structural unemployment problems remain, Chia warned.

Structural unemployment refers to the long-term unemployment caused by imbalances between the skills of workers and the demands of employers.

Younger people can expect to find jobs once the economy improves. Middle-aged workers will have more difficulty. Since they're often the main providers for families, their unemployment problem deserves extra attention, Chia said.

The Research Center for Taiwan Economic Development also warned that the July CCI still shows people are relatively pessimistic, though, despite the fact the index has reached its highest point in a year.

The CCI signifies optimism when it's above 100. Since all July indices were below 100, consumer confidence is yet to reach the neutral level, according to the release.

China Daily/CNA

(HK Edition 07/29/2009 page2)