Taiwan's Consumer Confidence Dips as Tariff Uncertainty Looms

Economic Volatility and Trade Concerns Weigh on Sentiment

Taipei, April 28 – Consumer confidence in Taiwan has plummeted to a nearly one-year low, signaling growing unease among the population. This downturn in sentiment is largely attributed to the unpredictable tariff policies of U.S. President Donald Trump, which have triggered global economic and market instability.

The latest Consumer Confidence Index (CCI) experienced a significant drop of 3.65 points from the previous month, settling at 68.21. This marks the lowest level since May 2024, according to National Central University (NCU), based on their survey conducted from April 18-21.

The survey followed President Trump’s announcement of high "reciprocal" tariffs against several countries, including Taiwan, on April 2nd. Although these tariffs were temporarily paused a week later, a baseline universal tariff of 10 percent remains in effect for most countries.

The CCI assesses consumer confidence over the next six months, considering factors such as consumer prices, the local economic climate, the stock market, intentions to purchase durable goods, employment prospects, and family finances.

In April, all six sub-indexes declined. The sub-index for the stock market outlook witnessed a sharp decrease of 11.25 points, reaching 38.64, its lowest point in a year.

Furthermore, the sub-indexes for consumer prices, family finances, the local economic climate, and employment prospects also reached their lowest points since July 2024.

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Dachrahn Wu (吳大任), director of the NCU Research Center for Taiwan Economic Development, highlighted that the announcement of "reciprocal" tariffs led to Taiwan's stock market experiencing its most significant single-day drop in history on April 7, shedding over 2,000 points.

Despite the temporary pause in tariffs, Wu believes that market volatility persists due to the unresolved nature of President Trump’s tariff policies, especially regarding semiconductors.

Wu noted that this ongoing uncertainty has increased financial market volatility, leading investors to become more cautious.

Wu expressed pessimism regarding the potential impact of the "reciprocal" tariffs, predicting that Taiwan's semiconductor exports could face U.S. import duties of up to 25-30 percent.

Wu warned that such high tariffs could significantly impact Taiwan's industrial sector, domestic economy, and the job market, contributing to the further decline in the CCI.

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Another concerning factor was the sub-index for the likelihood of purchasing durable goods, which dipped below the 100-point benchmark, reaching 99.13 from 101.99 in March. This indicates a shift from optimistic to pessimistic views on purchasing durable goods, according to Wu.

The NCU surveys use a scale where a CCI sub-index score of 0-100 indicates pessimism, while a score of 100-200 represents optimism.

The April CCI survey by the university collected 3,108 questionnaires from Taiwanese consumers aged 20 and over. The survey had a 95 percent confidence level and a margin of error of plus or minus 2.0 percentage points.