Taiwan Monetary Policy


Central Bank stays put

At its 27 March monetary policy meeting, the Central Bank of the Republic of China (Taiwan) decided to leave the discount rate unchanged at 1.875%. The Bank's decision was on par with market expectations. The Central Bank has left the key monetary policy rate unchanged since June 2011. In its statement, the Central Bank said that the recovery in the global economy continued at the outset of the year. However, the Bank recognized that risks in emerging economies persist, particularly in China, where economic growth has been decelerating, “as it sought structural rebalancing.” Domestically, monetary authorities stated that recent data suggest that growth slowed down in the first quarter, although labor conditions remain positive. Regarding price developments, the Central Bank noted that inflationary pressures from overseas remain subdued and that slower economic growth and a negative output gap are also keeping inflationary pressures contained. The Bank concluded that monetary authorities continued to manage market liquidity in order to maintain banks' excessive reserves “at an appropriate level” and that, “the current monetary policy is appropriate and a policy rate hold will help maintain price and financial stability and foster economic growth.” Focus Economics Consensus Forecast panelists see the discount rate at 1.89% in 2014. For 2015, panelists expect the discount rate at 2.14%.

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Taiwan Economic News

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    October 9, 2016

    In September, the trade surplus totaled USD 4.4 billion, according to data from the Ministry of Finance.

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  • Taiwan: Inflation moderates further in September

    October 5, 2016

    In September, consumer prices increased 0.45% over the previous month, which was a rebound from the 0.03% fall recorded in August.

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    Taiwanese manufacturers registered better business conditions for the fourth consecutive month in September.

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  • Taiwan: Central Bank halts easing cycle on healthy economic growth

    September 29, 2016

    At its quarterly monetary policy meeting on 29 September, the Central Bank of the Republic of China (Taiwan) decided to leave the discount rate unchanged at 1.375%, which was a decision that markets had expected, although some analysts had foreseen a further reduction to the key policy rate. The Central Bank has cut the main monetary policy rate four times since September 2015 by a total of 50 basis points and this time the authority decided to leave interest rates unchanged “against a back drop of moderate global growth and renewed momentum for the domestic economy, along with a mild inflation outlook for next year.” Regarding global developments and how they affect the Taiwanese economy, the Central Bank stated that the global economy continues to decelerate as a result of slower economic growth in the U.S., a still tepid recovery in the Eurozone economy and sluggish economic activity in Japan.

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  • Taiwan: Industrial production benefits from Apple’s new iPhone debut

    September 27, 2016

    Taiwan’s industrial output increased substantially in August, backed by a base effect but also due to strong growth in semiconductor manufacturers’ output, which benefited from the debut of Apple’s latest iPhone model.

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