19.03.202609:05:10UTC+00Taiwan Holds Rates as Expected

Taiwan's central bank left its key discount rate unchanged at 2% at its March 2026 policy meeting, in line with market expectations and extending the pause in rate changes that began in March 2024. The economy has remained strong, with GDP expanding 12.65% year-on-year in Q4 2025 — the fastest pace since Q3 1987 — supported by robust external demand for emerging technologies such as AI. At the same time, the annual inflation rate accelerated to 1.75% in February 2026 from a five-year low of 0.69% in January, reaching its highest level since April 2025. This sharp rebound was partly attributed to Lunar New Year holiday effects and rising global commodity prices amid heightened tensions in the Middle East. The central bank raised its 2026 forecasts for headline CPI and core CPI to 1.80% and 1.75%, respectively. It also reiterated that it will continue to closely track geopolitical risks, US trade policies, monetary policy decisions by major economies, developments in the AI sector, and extreme weather events.