TAIPEI (Reuters) – Taiwan’s central bank said on Wednesday that it would review the domestic and foreign economic and financial situations and adopt appropriate monetary policies to promote price stability and help economic growth next year.
The central bank, at its quarterly board meeting in September, unanimously decided to keep its policy rate at 1.875%.
It flagged continued tight monetary policy on Wednesday as it keeps a close eye on inflation, and trimmed its 2023 growth forecast for the export-reliant economy.
The central bank, in a report to parliament on its plans for next year, said it will “look closely at the domestic and foreign economic and financial situations and adopt appropriate monetary policy using various monetary policy tools”.
It will focus on price stability and helping with economic growth, it added in the report issued ahead of its governor, Yang Chin-long, taking lawmaker questions on Thursday.
Taiwan’s economy grew faster than expected in the third quarter, helped by domestic consumption, though exports remained weak because of sluggish global demand for the island’s high-tech products. The government expects full-year 2023 growth of 1.61%, the slowest in eight years.
The central bank, in its parliament report, also said it would strengthen the management mechanism for the entry and exit of foreign capital and guide the currency market to promote financial stability.
In its semi-annual currency report issued on Tuesday, the U.S. Treasury kept Taiwan on its foreign exchange “monitoring list”.
The Taiwan dollar has depreciated about 4.6% against the U.S. dollar so far this year.
(Reporting by Jeanny Kao; Writing by Ben Blanchard. Editing by Gerry Doyle)
