Taiwan Economic Outlook
August 20, 2019A preliminary estimate revealed growth hit a one-year high in the second quarter, supported by accelerating household spending and export growth. In addition, fixed investment remained strong despite concerns over the U.S.-China trade war, partly due to some Taiwanese companies returning activities from the mainland. That said, the positive reading is expected to be a one-off. Early data for the third quarter is mixed, while subdued electronics demand amid the escalating U.S.-China trade war continues to eat into growth. Exports swung back to contraction in July, and the U.S. announcement that it would implement fresh tariffs on China in August will likely further hurt exports ahead. Moreover, on 31 July, China announced a surprise travel ban on solo travelers to Taiwan, which will dent the island’s tourism sector and increases tensions across the strait.
Taiwan Economic GrowthHeadwinds from the U.S.-China trade war, a tense relationship with the mainland and subdued electronics demand will cause growth to slow this year. That said, returning investment and trade diversion should provide some respite, while low unemployment continues to shore up consumption. FocusEconomics panelists forecast GDP growth of 2.0% in 2019, which is up 0.1 percentage points from last month’s forecast, and 2.0% again in 2020.
Taiwan Economy Data
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|Bond Yield||0.68||1.28 %||Sep 04|
|Exchange Rate||31.27||0.07 %||Sep 04|
|Stock Market||10,657||0.37 %||Sep 04|
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Taiwan Economic News
September 9, 2019
Merchandise exports grew 2.6% in August compared to the same month a year earlier, contrasting the 0.5% fall in July.
September 6, 2019
Consumer prices fell 0.02% in August from the previous month, after falling a revised 0.12% in July (previously reported: -0.10% month-on-month).
September 2, 2019
The manufacturing Purchasing Managers’ Index (PMI), reported by IHS Markit, fell to 47.9 in August from 48.1 in July, and remained below the 50-point threshold that separates contraction from expansion for the eleventh month running. Manufacturers struggled in August as new work orders fell substantially in the month and exports fell at the fastest pace in over four years; on the back of this, output decreased at a quicker clip than in July.
August 23, 2019
Industrial output increased 3.0% in July from the same month last year, contrasting the revised 0.5% decrease in June (previously reported: -0.4% year-on-year). Output in the manufacturing sector—which represents more than 90% of total industrial production—rose 3.1% in July, contrasting the 0.8% dip in June.
August 7, 2019
Merchandise exports decreased 0.5% in July compared to the same month a year earlier, contrasting the 0.5% increase in June.