Financial News: Taiwan Central Bank Holds Policy Rate At 2.0%

Taiwan Central Bank Holds Policy Rate At 2.0%

12/19/2024 - 15:15:00 (RTTNews)

(RTTNews) - Taiwan's central bank retained its key interest rate at its December meeting on Thursday as the policy board observed that the current rate level would help sustain sound economic and financial development on the whole.

The central bank board decided to maintain the key discount rate at 2.0 percent.

In addition, the rate on refinancing of secured loans and the rate on temporary accommodations are unchanged at 2.375 percent and 4.25 percent, respectively.

Taiwan's exports grew steadily in the recent months, driven by an ongoing surge in demand for artificial intelligence and other emerging technology applications. Domestic demand also boosted on the back of rising private consumption and capital equipment imports.

The bank expects Taiwan's economy to expand by 4.25 percent for the current year as a whole and projected 3.13 percent growth for 2025.

Recent official data showed that Taiwan's CPI inflation rose to 2.08 percent in November due to price fluctuations in domestic food prices amid weather disruptions. Core inflation also accelerated to 1.74 percent.

The bank forecasted Taiwan's CPI and core CPI annual growth rates to slow further to 1.89 percent and 1.79 percent next year as domestic services inflation is expected to continue edging down.

Looking ahead, the central bank said policymakers will stay alert to the changing trends in domestic inflation and closely observe new developments in US economic and trade policy changes.

Further, they will closely watch the major central bank policy decisions, China's economic downturn risk, geopolitical conflicts, and extreme weather, and their implications for Taiwan's economic activity and financial conditions.

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