Taiwan Central Bank Announces Plans to Implement Appropriate Monetary Policies, According to Reuters

TAIPEI (Reuters) – Taiwan’s central bank announced on Wednesday that it will assess both domestic and international economic and financial conditions to implement suitable monetary policies aimed at maintaining price stability and supporting economic growth for the upcoming year.

During its quarterly board meeting in September, the central bank made the unanimous decision to maintain its policy rate at 1.875%.

In light of prevailing inflationary pressures, the central bank reiterated its commitment to a stringent monetary policy and adjusted its growth forecast for 2023 for the export-driven economy. In a report presented to parliament regarding its objectives for the next year, the bank stated that it will closely monitor economic conditions and utilize various monetary policy tools as needed.

The focus, as highlighted in the report, will be on ensuring price stability and fostering economic growth. This report comes ahead of Governor Yang Chin-long’s session with lawmakers scheduled for Thursday.

Taiwan’s economy outperformed expectations in the third quarter, buoyed by domestic consumption, although exports were lackluster due to weak global demand for the island’s high-tech products. The government anticipates that full-year growth for 2023 will reach 1.61%, marking the slowest rate in eight years.

In its report to parliament, the central bank also expressed its intent to enhance the management of foreign capital inflows and outflows, as well as to guide the currency market in a bid to promote financial stability.

Additionally, the U.S. Treasury included Taiwan on its foreign exchange monitoring list in its semi-annual currency report released on Tuesday. The Taiwan dollar has seen a depreciation of approximately 4.6% against the U.S. dollar thus far in 2023.