Taiwan Economic Outlook
May 21, 2019The economy slowed again in the first quarter of 2019 after a meek showing in the previous quarter, as weak export demand continued to restrain momentum. Export growth ticked down, likely due to contracting goods exports; imports, however, also slowed markedly, which supported the headline growth print. Meanwhile, domestic demand also weakened somewhat: Private consumption growth edged down despite a rebound in the stock market, while government consumption contracted and total investment also slowed. Turning to Q2, the picture remains bleak, with March export orders and April trade data indicating that exports likely contracted throughout the quarter. Moreover, Taiwan is extremely vulnerable to the possible imposition of new tariffs on Chinese imports from the U.S.—including tech products—which will likely weigh on business sentiment and investment in the quarter.
Taiwan Economic GrowthGrowth is set to slow this year due to lower tech export demand and a slowdown in mainland China. Furthermore, an escalation of the U.S-China trade war is a key downside risk as Taiwan is heavily involved in the Chinese electronics supply chain. Nevertheless, public infrastructure investment, and low unemployment and inflation should support domestic dynamics. FocusEconomics panelists forecast GDP growth of 2.1% in 2019, which is up 0.1 percentage points from last month’s forecast, and 2.1% again in 2020.
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|Bond Yield||0.71||1.28 %||Jun 13|
|Exchange Rate||31.48||0.07 %||Jun 13|
|Stock Market||10,561||0.37 %||Jun 13|
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Taiwan Economic News
June 10, 2019
Merchandise exports fell 4.8% in annual terms in May, worsening from the 3.3% contraction registered in April and marking the seventh consecutive month of decline in Taiwan’s trade sector.
June 5, 2019
Consumer prices rose 0.15% in May from the previous month, down from the 0.75% increase logged in April.
June 3, 2019
Operating conditions in the Taiwanese manufacturing sector continued to deteriorate in May for the eighth month running, though at a marginally slower pace than in April.
May 23, 2019
Industrial output increased 1.0% year-on-year in April, contrasting the 9.4% year-on-year decline logged in March—the worst fall in the production index since January 2012.Output in the manufacturing sector—which represents more than 90% of total industrial production—rose 0.9% in April, contrasting the 10.0% fall registered in March.
May 7, 2019
Consumer prices rose 0.75% in April from the previous month, contrasting the 0.62% decline logged in March.