Central Bank of the Republic of China (Taiwan)

September 29, 2016

Monetary officials agreed to leave Taiwan’s discount rate unchanged at 1.375%, which is an accommodative stance according to a statement released today. The interest rate was cut by 12.5 basis points at each of the previous four quarterly policy reviews stretching back to September 2015. Monetary stances have remained easy at the central banks in most advanced economies. External uncertainties persist, and Taiwanese inflation is subdued at 0.6%. Domestic growth is considered “slow” but expected to be stronger in 2017 than this year. Officials are prepared to intervene in the currency market if necessary: ” if seasonal or irregular factors (such as massive inflows or outflows of short-term capital) lead to excess volatility and disorderly movements in the NT dollar exchange rate with adverse implications for economic and financial stability, the CBC will, in line with its legal duties, step in to maintain an orderly market.”

Copyright 2016, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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