TAIPEI- Taiwan’s central bank is expected to keep its policy interest rate unchanged this week and to stay the course until late next year as it deals with persistent concerns over inflation, according to economists in a Reuters poll.
The central bank, in a surprise move at its last board meeting in March, hiked the benchmark discount rate to 2 percent from 1.875 percent , wary of continued inflationary pressures and ahead of a rise in electricity prices.
At its next quarterly meeting on Thursday it is expected to keep the rate steady, according to 29 of the 31 economists surveyed.
Economists who answered questions on the outlook beyond this week predicted the bank would start cutting rates only from the third quarter of 2025, with the median estimate a drop to 1.875 percent .
Central bank Governor Yang Chin-long indicated last week there would be no surprises at this meeting.
Taiwan’s consumer price index (CPI) rose by 2.24 percent in May, slightly higher than forecast and also above the 1.95 percent recorded in April, and it is expected to further increase in June due to rainy weather impacting food prices.
