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.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique