Taiwan’s macro story continues to be one of quiet resilience. The central bank remains on pause, inflation is cooling, and financial regulators are stepping back after a temporary tightening of market controls. Employment, meanwhile, is hitting fresh records - and that remains a core source of strength.
Monetary Policy
The Central Bank of the Republic of China (Taiwan) (CBC) is still holding fire. No change to the 2% policy rate since March which is exactly what we flagged last month when we noted the central bank’s preference for steady hands over premature tightening. Inflation continues to drift lower and now looks set to dip below 2% this year. That should keep the CBC comfortably on hold when it next meets later this month.
This is a continuation of the soft-landing trajectory we outlined in April and also in May. We see inflation moderating, tech demand staying strong and no real urgency for a policy pivot. Unless there’s a fresh external shock or a spike in domestic inflation, w...
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