Yuanta-Polaris Research Institute (元大寶華綜合經濟研究院) yesterday cut its forecast for the nation’s economic growth this year to 2.47 percent, from the 3.65 percent it forecast in March, citing weak economic momentum in the first half of this year.
The institute forecast a 2.2 percent year-on-year economic expansion in the second quarter, followed by growth of 3.01 percent and 2.91 percent in the third quarter and fourth quarter respectively.
“The chances of Taiwan’s economic growth maintaining 3 percent for the whole of this year are slim,” Yuanta-Polaris president Liang Kuo-yuan (梁國源) told a press conference.
Liang’s tone was more bearish than that of Council for Economic Planning and Development (CEPD) Minister Kuan Chung-ming (管中閔), who recently said the economy could still expand 3 percent this year from last year.
Following Yuanta-Polaris’ less upbeat forecast, the central bank is likely to keep its policy interest rates unchanged at its board meeting today, the Taipei-based think tank said.
Liang was also pessimistic about the nation’s private consumption, citing stagnancy in real wages. The institute forecast private consumption might only grow 1.23 percent this year from last year.
However, rebounding exports in the second half of this year could provide some momentum to the economy, led by shipments from the semiconductor sector, he added.
Liang said he does not expect any impact on Taiwan’s economy this year from the cross-strait service trade agreement, but the pact may affect some industries longer term, either positively or a negatively.
“The government has to carry out more detailed and comprehensive analysis about how the pact will impact the nation’s industries, and disclose its findings to the public,” he told the Taipei Times.
On the consumer price front, the institute forecast that headline inflation will rise modestly at 1.26 percent this year.
In March, the institute forecast consumer prices to increase 1.53 percent this year.
However, consumer prices may rise 1.73 percent in the fourth quarter — the highest level this year — if the government raises electricity rates in October, the institute said.
Yuanta-Polaris forecast that the NT dollar will average NT$30 against the US dollar this year, from an average of NT$29.7 it estimated previously.
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is