Taiwan’s economy last quarter expanded 7.47 percent from a year earlier, 0.54 percentage points faster than last month’s official forecast, thanks to stronger-than-expected exports, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
“The domestic COVID-19 outbreak wreaked havoc with service-oriented sectors, but did not affect the manufacturing industry, which continued to benefit from the stay-at-home economy and gradual reopenings in the US and Europe,” Wu Pei-shuan (吳佩璇), an official at the agency’s national income section, told an online news conference.
Exports surged 37.35 percent year-on-year from April to June on the back of robust demand for electronics used in smartphones, laptops, TVs and vehicles, as well as artificial intelligence and Internet-of-Things applications.
Photo: CNA
Outbound shipments of plastic, chemical and base metal products also spiked more than 40 percent as customers around the world rebuilt inventory, DGBAS said.
The COVID-19 pandemic has prompted schools, companies and government agencies to speed up digital transformation, thereby bolstering the selling prices of electronic components and contributing to supply crunches and shipping chaos, it said.
Imports soared 36.38 percent, driven by agricultural and industrial price hikes and avid purchases of capital equipment and consumer goods, the agency’s report showed.
Altogether, external demand contributed 5.19 percentage points to last quarter’s GDP, Wu said.
For the first half of the year, the economy grew 8.19 percent, meriting an upward revision next month, when the statistics agency updates its economic forecast. The official declined to speculate.
Domestically, private consumption shrank 0.55 percent, weighed down by a soft lockdown as the government on May 19 imposed a nationwide level 3 COVID-19 alert to curb the outbreak, the DGBAS said.
However, retail sales increased 2.29 percent year-on-year as e-commerce flourished, while physical stores and businesses were hit hard, Wu said.
Securities trading also thrived, with daily turnover growing more than twofold, she added.
Still, private consumption dragged GDP growth by 0.2 percentage points, the agency said.
The government lent support by adding 0.34 percentage points to GDP growth as it stepped up COVID-19 testing, vaccination and treatment expenses, DGBAS said.
The second quarter also saw capital formation swell 24.39 percent from a year earlier, as Taiwanese firms build up 5G infrastructure, green energy capacity, shipping vessels and semiconductor capital equipment to meet business needs, Wu said.
Overall, domestic demand made a lackluster contribution of 2.28 percentage points to GDP growth last quarter.
Wu said private consumption would fare better from this month following the conditional opening of entertainment and recreational facilities.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to