TAIPEI (Taiwan News) — The Central Bank is expected to keep interest rates unchanged this week and maintain that stance through 2027, according to economists in a Reuters poll.

All 29 economists surveyed expect the bank to hold its benchmark discount rate at 2% at its quarterly meeting on Thursday. The rate has remained unchanged since December after a 0.125 percentage point increase in March 2024.

Economists who offered longer-term forecasts also expect the bank to keep rates steady through the second quarter of 2027. Analysts said the policy outlook reflects the resilience of Taiwan’s economy, particularly its technology sector.

Taiwan’s export-driven economy has benefited from the global AI boom, boosting demand for chipmakers such as TSMC. The company makes about 90% of the world’s advanced chips.

The government’s statistics agency in February forecast economic growth of 7.7% this year after the economy expanded 8.68% last year, the fastest pace in 15 years.

“There is no sign of a slowdown in the first quarter of this year,” said Wang Yu-hsuan, an analyst at First Capital Management.

However, analysts said risks remain if conflict in the Middle East pushes energy prices higher. Taishin Securities Investment Advisory analyst Kevin Wang warned that prolonged fighting and sustained high energy prices could create stagflation risks.

Taiwan’s consumer price index rose 1.75% in February, above analysts’ expectations of 1.5%, but remained below the central bank’s 2% warning level for the 10th consecutive month. The Central Bank is also expected to release updated economic growth and inflation forecasts at Thursday’s meeting.