With the economy expanding by a stronger-than-expected 12.53 percent in the second quarter and a revised 13.71 percent growth in the first quarter, the central bank could raise interest rates in the second half to ease rising prices, economists said yesterday.
Cheng Cheng-mount (鄭貞茂), Citigroup Taiwan’s chief economist, said the central bank was likely to continue its close watch on still-high housing prices in the face of strong GDP growth but a benign inflation forecast.
“We believe the central bank will likely raise policy rates by another 12.5 basis points in September, but may switch to micro-prudential policy to cool housing prices instead of rate hikes, on concerns about increasing uncertainty in the global economic outlook,” Cheng said in a note.
The bank raised the benchmark rate by 12.5 basis points in June for the first time since 2008.
Cheng’s comment came after the government raised its GDP growth forecast for this year to 8.24 percent, from the 6.14 percent predicted in May.
Kevin Hsiao (蕭正義), head economist of UBS Wealth Management Research, also forecast an interest rate hike of 12.5 basis points.
“A rate hike of that scale is symbolic in nature, but the central bank would take steps to stabilize rising food costs,” Hsiao said.
The government yesterday forecast that inflation would rise 1.23 percent this year and 1.43 percent next year.
But Tine Olsen, a Sydney-based economist at Moody’s Economy.com, said in an e-mailed statement that weak private consumption could be a potential problem to ensure sustainable economic growth in the second half.
“Consumers are haunted by still-high unemployment and though the economy is adding jobs, it is not happening fast enough to absorb new entrants and the long queue of unemployed workers,” she wrote.
ADDITIONAL REPORTING BY CRYSTAL HSU
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday said its materials management head, Vanessa Lee (李文如), had tendered her resignation for personal reasons. The personnel adjustment takes effect tomorrow, TSMC said in a statement. The latest development came one month after Lee reportedly took leave from the middle of last month. Cliff Hou (侯永清), senior vice president and deputy cochief operating officer, is to concurrently take on the role of head of the materials management division, which has been under his supervision, TSMC said. Lee, who joined TSMC in 2022, was appointed senior director of materials management and
Nvidia Corp CEO Jensen Huang (黃仁勳) on Thursday met with US President Donald Trump at the White House, days before a planned trip to China by the head of the world’s most valuable chipmaker, people familiar with the matter said. Details of what the two men discussed were not immediately available, and the people familiar with the meeting declined to elaborate on the agenda. Spokespeople for the White House had no immediate comment. Nvidia declined to comment. Nvidia’s CEO has been vocal about the need for US companies to access the world’s largest semiconductor market and is a frequent visitor to China.
MAJOR CONTRIBUTOR: Revenue from AI servers made up more than 50 percent of Wistron’s total server revenue in the second quarter, the company said Wistron Corp (緯創) on Tuesday reported a 135.6 percent year-on-year surge in revenue for last month, driven by strong demand for artificial intelligence (AI) servers, with the momentum expected to extend into the third quarter. Revenue last month reached NT$209.18 billion (US$7.2 billion), a record high for June, bringing second-quarter revenue to NT$551.29 billion, a 129.47 percent annual increase, the company said. Revenue in the first half of the year totaled NT$897.77 billion, up 87.36 percent from a year earlier and also a record high for the period, it said. The company remains cautiously optimistic about AI server shipments in the third quarter,
Hypermarket chain Carrefour Taiwan and upscale supermarket chain Mia C’bon on Saturday announced the suspension of their partnership with Jkopay Co (街口支付), one of Taiwan’s largest digital payment providers, amid a lawsuit involving its parent company. Carrefour and Mia C’bon said they would notify customers once Jkopay services are reinstated. The two retailers joined an array of other firms in suspending their partnerships with Jkopay. On Friday night, popular beverage chain TP Tea (茶湯會) also suspended its use of the platform, urging customers to opt for alternative payment methods. Another drinks brand, Guiji (龜記), on Friday said that it is up to individual
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