- Decision
- Maintain
- Rate change
- 0 bps
- discount rate
- 2%
The Board of the Central Bank of the Republic of China (Taiwan) unanimously left the discount rate at 2.00%, the secured-loan refinancing rate at 2.375% and the temporary-accommodation rate at 4.25%, judging that with inflation projected to remain below 2 percent and GDP growth expected to stay solid next year, a hold best supports overall economic and financial stability amid elevated external uncertainties. After keeping the key rate at 2.00 percent at all quarterly meetings since March, the stance is unchanged. Market liquidity is ample, interbank rates have been stable and banks’ excess reserves averaged slightly above TWD 45 bn between September and November. CPI inflation slowed to 1.69 percent y/y on average in the first eleven months and is forecast at 1.66 percent for 2025 and 1.63 percent for 2026, while GDP is seen expanding 7.31 percent this year before moderating to 3.67 percent. M2 grew 4.5 percent and bank loans and investments 6.7 percent over January–November. The central bank reiterated that the NT dollar is market-determined but it will act to prevent excessive volatility, noting that lower global oil prices and divergent policy moves by major central banks are tempering inflation yet keeping financial markets volatile. It pledged to continue monitoring risks from AI-industry prospects, U.S. trade policy, China’s slowdown, geopolitical tensions and climate change, and to adjust policy in a timely manner as needed.
Rate evolution
From June 2025 through September 2026, the Central Bank of the Republic of China (Taiwan) kept its policy rates unchanged, leaving the discount rate at 2% throughout as it maintained a cautious hold amid contained inflation and solid domestic growth. Across the period, the Board cited gradual disinflation, mild inflationary pressures and ample liquidity, while noting that strong demand for artificial intelligence and other emerging technology applications, earlier tariff-related front-loading, and later a pickup in private consumption supported exports and investment.
Its risk framing centred on uncertainty over U.S. tariff policy, China’s slowdown risk, major central bank actions, geopolitical conflicts and weather, with uncertainty easing somewhat by September 2025 before broadening again by December. In March 2026, despite revising inflation forecasts higher after the Middle East conflict lifted oil and commodity prices, the Bank again held rates, judging inflation still moderate and growth solid on AI-led exports, investment and firmer consumption. In the second quarter of 2026, it left the discount rate, the rate on refinancing of secured loans and the rate on temporary accommodations unchanged at 2%, 2.375% and 4.25%, respectively, even as it raised its GDP growth forecast to 9.45% and nudged up its CPI and core CPI forecasts to 1.91% and 1.90%, saying a prudent hold would support sound economic and financial development. In September 2026, the Board kept all three rates at those levels, judging inflation would remain contained and ease below 2% in 2027 while growth stayed solid, even as it raised its 2026 GDP growth forecast to 11.48% on sustained AI-related demand and lifted its CPI and core CPI forecasts to 2.03% and 2.16% given elevated oil prices and persistent services inflation.