The nation’s 4 percent GDP target this year might be difficult to attain, as Russia’s invasion of Ukraine and global monetary tightening is expected to weigh on exports in the second half, central bank Governor Yang Chin-long (楊金龍) said yesterday.
At a meeting of the legislature’s Finance Committee, Yang said that the central bank would revise its growth forecast at its board meeting next month.
The nation’s top monetary policymaker in March said the growth rate was expected to be 4.05 percent.
Photo: Wang Yi-sung, Taipei Times
“GDP growth of 4 percent this year looks increasingly untenable, as unfavorable factors would start to weigh in the second half, even though exports and consumption data have fared quite well thus far,” Yang said.
The war in Ukraine has been termed a “black swan” event — something that was unpredictable and had profound consequences on the global economy — while the rate hikes by the US Federal Reserve have been called a “gray rhino” event — a threat to markets that was predictable, yet largely ignored.
The military conflict in eastern Europe prompted major countries to impose sanctions on Russian oil and gas exports, which drove up international prices for fuel and raw materials.
Global central banks are hiking interest rates to help curb inflation, which is likely to slow economies down.
“The downside risks raise concern over whether growth momentum for Taiwan’s exports can extend into the second half,” Yang said.
Major chipmakers have given rosy earnings guidances for this quarter, while suppliers of laptops and other electronic devices expect declines due to COVID-19 lockdowns in China.
International research bodies have trimmed their forecasts for Taiwan’s GDP growth this year to 3.6 to 3.8 percent, Yang said.
Consumer prices in Taiwan remain high this month after being above 3 percent for the past two months, Yang said.
However, he refused to say unequivocally that the central bank would increase interest rates at next month’s meeting.
“The central bank has made known its stance leaning toward tightening and there are several policy options to achieve that end,” Yang said, citing interest rate hikes, selective credit controls and draining liquidity from the foreign exchange market, among other measures.
The central bank is mulling further selective credit controls, especially in areas with evident housing price hikes, to induce a soft landing, he said.
Policy tools under consideration include shortening mortgage periods and lowering loan-to-value ratios for second-home financing, he said, adding that the current policy only bans grace periods on second-home mortgages.
Shorter mortgage periods, from 20 to 30 years, would prompt borrowers to be more cautious in their financial planning, Yang said.
A magnitude 7.0 earthquake struck off Yilan at 11:05pm yesterday, the Central Weather Administration (CWA) said. The epicenter was located at sea, about 32.3km east of Yilan County Hall, at a depth of 72.8km, CWA data showed There were no immediate reports of damage. The intensity of the quake, which gauges the actual effect of a seismic event, measured 4 in Yilan County area on Taiwan’s seven-tier intensity scale, the data showed. It measured 4 in other parts of eastern, northern and central Taiwan as well as Tainan, and 3 in Kaohsiung and Pingtung County, and 2 in Lienchiang and Penghu counties and 1
A car bomb killed a senior Russian general in southern Moscow yesterday morning, the latest high-profile army figure to be blown up in a blast that came just hours after Russian and Ukrainian delegates held separate talks in Miami on a plan to end the war. Kyiv has not commented on the incident, but Russian investigators said they were probing whether the blast was “linked” to “Ukrainian special forces.” The attack was similar to other assassinations of generals and pro-war figures that have either been claimed, or are widely believed to have been orchestrated, by Ukraine. Russian Lieutenant General Fanil Sarvarov, 56, head
FOREIGN INTERFERENCE: Beijing would likely intensify public opinion warfare in next year’s local elections to prevent Lai from getting re-elected, the ‘Yomiuri Shimbun’ said Internal documents from a Chinese artificial intelligence (AI) company indicated that China has been using the technology to intervene in foreign elections, including propaganda targeting Taiwan’s local elections next year and presidential elections in 2028, a Japanese newspaper reported yesterday. The Institute of National Security of Vanderbilt University obtained nearly 400 pages of documents from GoLaxy, a company with ties to the Chinese government, and found evidence that it had apparently deployed sophisticated, AI-driven propaganda campaigns in Hong Kong and Taiwan to shape public opinion, the Yomiuri Shimbun reported. GoLaxy provides insights, situation analysis and public opinion-shaping technology by conducting network surveillance
‘POLITICAL GAME’: DPP lawmakers said the motion would not meet the legislative threshold needed, and accused the KMT and the TPP of trivializing the Constitution The Legislative Yuan yesterday approved a motion to initiate impeachment proceedings against President William Lai (賴清德), saying he had undermined Taiwan’s constitutional order and democracy. The motion was approved 61-50 by lawmakers from the main opposition Chinese Nationalist Party (KMT) and the smaller Taiwan People’s Party (TPP), who together hold a legislative majority. Under the motion, a roll call vote for impeachment would be held on May 19 next year, after various hearings are held and Lai is given the chance to defend himself. The move came after Lai on Monday last week did not promulgate an amendment passed by the legislature that
RSS