Taiwan’s growth outlook improves on electronics exports
TAIPEI - ANZ Bank has revised upwards its GDP growth outlook due to the sustained vibrancy of global electronic supply chains. It says the advance estimate of Q3 GDP has accelerated to 3.11% y/y, beating expectations (and the highest since Q1 2015) mainly due to a boost in tech exports.
“Advancement in semiconductor business bodes well for the electronics sector,” ANZ says. “We believe this momentum will continue, with GDP expanding by 2.9% y/y in 2017 and 3.0% y/y in 2018 – that is, 0.7% higher than our original forecasts for both years.”
The bank has adjusted downwards its inflation forecasts for 2017 and 2018 due to weak wage growth and low import prices.
It says headline CPI inflation is expected to print 0.7% y/y in 2017 and 1.2% y/y in 2018. Fuel and electricity prices will likely see some upward pressure in the near term amid higher global crude prices.
“However, the strong performance of corporates in Taiwan will attract capital inflows which are positive for the currency. This will in turn help suppress import inflation.” www.live.anz.com (ATI).