- Decision
- Maintain
- Rate change
- 0 bps
- discount rate
- 2%
The Central Bank of the Republic of China (Taiwan) left its policy stance unchanged at the 19 March 2026 Board meeting, holding the discount rate, secured-loan refinancing rate and temporary accommodation rate at 2.00%, 2.375% and 4.25%, respectively, as moderate inflation and an upgraded outlook for solid growth were set against elevated global uncertainty from the Middle East conflict and shifting U.S. trade policies. The hold prolongs a steady path that has kept the discount rate at 2.00% since at least March 2025. Market implementation remains smooth: banking-system excess reserves averaged about TWD 56 bn in January–February and money-market rates stayed within a narrow band amid 5.27 % M2 and 7.04 % bank credit growth. The Bank lifted its 2026 GDP growth forecast to 7.28% on AI-driven export and investment strength, while nudging up full-year CPI and core CPI projections to 1.80% and 1.75% after respective January–February prints of 1.23% and 1.93%. Externally, authorities noted NT-dollar trading remains market-determined but pledged intervention to smooth heightened FX volatility linked to surging oil prices and geopolitical risks. Concurrently, the Board eased macro-prudential policy by raising the loan-to-value ceiling on second home mortgages for individuals to 60%, citing cooling real-estate credit growth and lower housing-price pressures. Looking ahead, the central bank will track geopolitical developments, U.S. policy shifts, major-economy rate paths, AI industry trends and weather conditions, adjusting policy in a timely manner to safeguard price and financial stability.
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.