Discount Rate in Taiwan
The Discount Rate ended 2022 at 1.75%, up from the 1.13% end-2021 value and down from the reading of 1.88% a decade earlier. For reference, the average Discount Rate in Asia-Pacific was 3.70% at end-2022. For more interest rate information, visit our dedicated page.
Taiwan Interest Rate Chart
Note: This chart displays Policy Interest Rate (%) for Taiwan from 2013 to 2022.
Source: Central Bank of Taiwan.
Taiwan Interest Rate Data
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Discount Rate (%, eop) | 1.38 | 1.38 | 1.13 | 1.13 | 1.75 |
| 31-90 Day CP Rate (%, eop) | 0.67 | 0.67 | 0.48 | 0.48 | 1.36 |
| 10-Year Bond Yield (%, eop) | 0.86 | 0.67 | 0.32 | 0.74 | 1.28 |
Central Bank keeps rates unchanged in September
At its monetary policy meeting on 21 September, the Board of Directors of Taiwan’s Central Bank (CBC) left the policy rate at 1.875%. The CBC hiked interest rates 75 basis points from early 2022 to early 2023, a much milder tightening cycle than that of most other countries.
Mild price pressures supported the Bank’s decision to stay put: Both headline and core inflation have averaged at 2–3% so far this year, less than half the rate in other advanced economies. Moreover, the CBC judged that inflation would trend slightly lower in the second half of the year than in the first. In addition, economic activity is moderate, with a negative output gap expected this year and next.
The Bank gave no explicit forward guidance. Our panelists see interest rates unchanged at the CBC’s final meeting of the year on 14 December. Next year, some panelists see rates unchanged while others see the Central Bank cutting rates.
Giving their take on the outlook, United Overseas Bank’s Ho Woei Chen said: “We reiterate our call for an extended rate pause in Taiwan. Our forecast for the discount rate remains at 1.875% through to end-2024, considering the level of inflation rate and a higher for longer interest rate environment globally.” In contrast, Goldman Sachs’ analysts are slightly more dovish: “While we maintain our view that the CBC is done with policy rate hikes, we are pushing back the timing of the first rate cut to Q4 2024 (from Q2 2024 previously).”
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Taiwanese interest rate projections for the next ten years from a panel of 14 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Taiwanese interest rate.
Download one of our sample reports to visualize what a Consensus Forecast is and see our Taiwanese interest rate projections.
Want to get access to the full dataset of Taiwanese interest rate forecasts? Send an email to info@focus-economics.com.