Taiwan’s key interest rates remain unchanged in an effort to stabilize the domestic financial market amid uncertainties arising from the global economy, according to the ROC Central Bank Dec. 29.
Following the announcement, rates for discounts and accommodations with or without collateral stayed at 1.875 percent, 2.25 percent and 4.125 percent, respectively.
Perng Fai-nan, central bank governor, said the decision to keep interest rates at current levels will help sustain economic growth and maintain financial stability in Taiwan.
“Despite the stagnant global economy triggered by the European sovereign debt crisis beginning to impact Taiwan exports, the economy is still projected to grow 4.19 percent in 2012,” Perng said.
Unlike their Western counterparts, the local banking sector is not experiencing a credit crunch, with loan and investment growth reaching 7.59 percent as of November, he added.
For the first 11 months of the year, Taiwan’s consumer price index increased only 1.37 percent, largely due to generally mild weather and a strong New Taiwan dollar partially offsetting inflation, Perng said. “Moderate price increases have also helped keep local interest rates at relatively low levels.”
“But mild inflation also means we will have a lower comparison base when calculating CPI figures next year,” Perng said, adding that maintaining price stability is a key goal for central bank policymakers in 2012.
Perng said the ROC government is fully prepared to tackle the challenges ahead, and the central bank is cautiously optimistic about Taiwan’s economic outlook.
“We will continue to keep a close eye on market developments at home and abroad and adopt monetary policies in a timely manner as warranted.” (JSM)
Write to Meg Chang at meg.chang@mail.gio.gov.tw