Sept 16 (Askume) – Taiwan’s central bank is expected to keep its policy rate unchanged this week to ease inflation concerns and maintain it at the same level until the end of next year, economists surveyed by Askume said.
The central bank set the required standard discount rate (TWINTR=ECI) at its last quarterly meeting in June
32 economists surveyed said they expected rates to remain steady again at the next quarterly meeting on Thursday.
Economists answering questions on the outlook this weekend predicted the Bank of England would start cutting interest rates only from the third quarter of 2025, with the average forecast falling to 1.875%.
Inflation in Taiwan has never been as high as in major Western economies. The consumer price index (CPI) rose 2.36% in August, higher than expected, but the central bank has made it a top priority and set an inflation target of 2%. The Wire.
Xu Jian of Wanlian Securities said stability is the most likely outcome given Taiwan’s inflation.
“The central bank will not follow the Fed,” Hsu said, referring to the Federal Reserve , which is expected to cut interest rates by at least a quarter of a percentage point this week.
Last week, the European Central Bank cut interest rates again and signaled that borrowing costs would “fall” in the coming months as inflation and economic growth in the euro zone slows.
Taiwan’s tech-focused, export-dependent economy is booming thanks to rising demand for artificial intelligence (AI), whichOrders surged from companies like TSMC (2330.TW), the world’s largest contract chipmaker.
But last month, Taiwan’s Bureau of Statistics lowered its economic growth forecast for this year to 3.9% from +3.94% due to weak exports and some uncertainty about demand for artificial intelligence .
The central bank will publish revised economic growth and inflation forecasts for this year and its first forecast for next year on Thursday.
