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Taiwan economy to grow at 3.5%: Cathay Financial Holding

Taiwan economy to grow at 3.5%: Cathay Financial Holding

Taipei, March 16 (CNA) Cathay Financial Holding Co. (????) published its latest forecast for Taiwan's economic prospects Monday, raising this year's expected growth in gross domestic product (GDP) from 3.22 percent to 3.5 percent. Although the figure represents a more conservative outlook than the 3.78 percent growth predicted by the Directorate General of Budget, Accounting and Statistics, the economy is nevertheless expected to grow at above 3 percent this year. The company said that as countries across Asia initiate interest rate cuts, Taiwan's relatively low inflationary pressure is helpful in setting the stage for stable economic growth momentum over the course of the year. However, it added that it retains a conservative outlook on investment prospects in the domestic market, due to lingering uncertainties. In addition, the company said that Taiwan's central bank is expected to keep interest rates unchanged over the first half of this year, and that although the likelihood of rate hikes has greatly diminished, it is not expected to join in the wave of rate cuts seen elsewhere in Asia. According to the company, the International Monetary Fund (IMF) has reduced this year's global GDP growth rate to 3.5 percent and has stated that despite the boon of lower oil prices, many countries -- with the exception of the United States -- are still seeing sluggish economic growth. The IMF said that global economic growth will be slower during March and April, and will improve further in May and June, and that the GDP will grow at a moderate range between 0.7 percent and 0.8 percent amid relatively low risk. The company listed a number of factors that will determine this year's economic growth performance. International developments include the effectiveness in spurring economic recovery through quantitative easing policies and interest rate cuts enacted in Europe and in China, and whether the interest rate hikes in the U.S. will exceed market expectations. Domestically, economic growth will be affected by political uncertainty in the run-up to the 2016 presidential election, the company said. (By Tien Yu-pin and Ted Chen)


Updated : 2021-09-27 11:11 GMT+08:00