The nation’s economy grew a stronger-than-expected 3.42 percent last quarter, bringing the whole year’s GDP growth to 1.25 percent, according to statistics released by the Directorate-General of Budget, Accounting and Statistics (DGBAS) yesterday.
The government agency previously forecast that the nation’s economy would expand 2.97 percent last quarter and 1.13 percent last year.
The agency yesterday also raised its GDP growth forecast for this year to 3.53 percent, from a forecast of 3.15 percent in November last year, on growth momentum from smartphones, tablets and smart TVs.
“As recent economic data at home and abroad both swung back to the positive side, this indicated economic recovery is gathering pace,” DGBAS Senior Executive Officer Jasmine Mei (梅家瑗) told a press conference.
Mei said the nation’s economy may grow at a stronger rate than the “U-shaped recovery” described by central bank Governor Perng Fai-nan (彭淮南) in December last year.
The better-than-expected global economy saw the DGBAS boost its forecast for annual growth in exports this year to 6.07 percent, from the 5.11 percent it forecast in November last year, a major factor for the upward revision of its GDP growth forecast for this year, DGBAS section chief Joshua Gau (高志祥) said.
The DGBAS has also seen the nation’s semiconductor sector, flat-panel manufacturers and mobile phone suppliers forecast a positive outlook for sales this year, a positive driver for the output sector, Gau said.
The private consumption rate may rise 1.56 percent this year, while the fixed capital formation sector is expected to expand 5.44 percent, the DGBAS said.
On the inflation front, the DGBAS revised its forecast to an annual increase of 1.31 percent in the consumer price index (CPI) this year, from the 1.27 percent it previously forecast.
Donna Kwok (郭浩庄), an economist for Greater China at HSBC Asia, said with raw material prices back on the rise, inflation issues are likely back on the central bank’s radar.
“The CBC [central bank] may well resume rates normalization in the first half of this year, possibly as early as the end of this quarter,” Kwok said in a research note.
Last year, the nation’s GDP grew 1.25 percent under the DGBAS’ preliminary analysis, higher than the 1.13 percent previously forecast due to stronger-than-expected economic expansion in the fourth quarter.
A surprise increase in private sector consumption — which rose 1.62 percent in the fourth quarter, rather than the 0.14 percent increase forecast by the DGBAS — was the main factor boosting economic momentum during the period, following a bull run on the securities market from late November last year.