The nation's central bank cut interest rates by 25 basis points yesterday, following a half-point reduction in the US.
This is the eleventh cut in a row, with total reductions totaling 2.5 percentage points since last December. The move aims to boost private consumption and investment as overseas demand remains sluggish amid a global economic slowdown.
The central bank reduced its rediscount rate to a record low of 2.25 percent from 2.5 percent.
The US Fed cut its discount rate to 2 percent on Tuesday, the lowest mark in 40 years.
"Overseas demand has weakened sharply, and domestic demand has also been weakened by the rising unemployment rate," the central bank announced.
The central bank also lowered the reserve requirement set aside for foreign currency deposits to 2.5 percent from 5 percent.
The Chunghua Institute for Economic Research last month predicted Taiwan's economy will contract by 1.76 percent this year.Also See Fed Inside
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