Taiwan will not follow the US in setting its monetary policy, but it would pay attention to global peers’ moves, international raw material price trends and geopolitical risks, central bank Governor Yang Chin-long (楊金龍) told a meeting of the legislature’s Finance Committee yesterday.
“There is no need for Taiwan to follow the US monetary decisions,” as the US Federal Reserve is widely believed to raise interest rates by 50 basis points next month in another of six more rate hikes for this year to curb inflation, Yang said.
US inflation last month hit 8.5 percent, while Taiwan’s rose 3.27 percent, rendering drastic rate hikes unwarranted, he said.
Photo: CNA
Rather, the central bank will approach the matter by taking into consideration policy moves by global peers, inflationary pressures at home, and international fuel and raw material price movements, he said.
In addition, the central bank will seek to support the nation’s economy to meet its duty, he said.
Yang said he stood by the view that Taiwan could achieve a GDP growth of 4 percent this year, although international research bodies have cut their forecast to an average of 3.8 percent after Russia invaded Ukraine in February and crude prices have since shot up.
Consumer prices in Taiwan are likely to ease next quarter, although the landscape is teeming with uncertainties, Yang said.
The central bank will make its quarterly decisions guided by the latest global and domestic economic data, Yang said, while acknowledging that the ongoing weakening of the New Taiwan dollar against the greenback is lending force to inflation.
Consumer prices picked up 0.1 to 0.17 percentage points after the NT dollar recently softened from NT$28 to NT$29 versus the US currency, Yang said, describing the extra inflationary burden as moderate.
A weak NT dollar will not necessarily become a norm, but has much to do with global funds responding to the Fed’s rate hikes and asset adjustments, he said.
“The market will have the final say on the NT dollar’s movements, but it remains the best performer in the past two years, thanks to Taiwan’s robust economy and corporate profitability,” Yang said.
The governor reiterated that the rate hike on March 17 is not aimed at cooling the property market, even though it inevitably sent unfavorable messages.
The central bank would favor selective credit controls to prevent funds from overflowing to the property market, he said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts