By Sherry Qin
Taiwan's central bank again left interest rates unchanged as the export-reliant economy remained resilient in the face of tariff headwinds.
The Central Bank of the Republic of China (Taiwan) kept its benchmark discount rate at 2.000% on Thursday, marking a fifth consecutive hold. The decision was expected by all eight economists polled by The Wall Street Journal.
It maintained secured and unsecured loan rates at 2.375% and 4.250%, respectively.
The Taiwan bank remains one of the few holdouts in the global rate-cutting cycle. It last cut rates in March 2020, during the pandemic.
The central bank attributed the decision to uncertainty surrounding the U.S. economy and trade policies. "Maintaining the policy interest rate unchanged this time will contribute to the stable development of the overall economy and finance," it said.
The island economy's activity has stayed robust this year despite the threat posed by President Trump's tariffs. Exports have kept up a strong growth pace, likely aided by front-loading to get ahead of tariffs.
That removes the need to lower borrowing costs, although persisting uncertainty about the trade outlook--including fading front-loading effects--could present a case for easing later in the year. Steadying domestic inflation also makes an argument for looser policy.
At Thursday's meeting, the central bank said it expects inflation to come down to 1.81% this year from 2.18% last year. It maintained its 2025 economic growth forecast at 3.05% and said the growth momentum of exports will weaken later this year due to tariff headwinds.
Write to Sherry Qin at sherry.qin@wsj.com
(END) Dow Jones Newswires
06-19-25 0509ET
