TAIPEI (Taiwan News) — Taiwan had no need to follow the example of the United States, Central Bank Governor Yang Chin-long (楊金龍) said Wednesday (April 13) in response to reports that the Federal Reserve might hike interest rates up to six times this year.
Because of high inflation in the U.S., the Fed was likely to launch two rounds of rate hikes in May and four more later in 2022, according to recent international media reports.
Because Taiwan’s Central Bank already followed the U.S. lead once in March, speculation has been mounting that it would continue to do so, CNA reported. However, Yang told lawmakers Wednesday that there was no need for Taiwan to handle rates exactly the same way the Federal Reserve was doing.
The central banker said the institution would base its decisions on factors including the domestic COVID-19 situation, the supply of raw materials, trends in major currency exchange rates, regional political risks, and developments concerning Taiwan’s inflation and finances. He named stability and assisting economic development as the bank’s two main aims.
Yang said the general expectation was that inflationary pressure would subside during the third quarter, but the international situation still needed to be looked at before any decision could be taken. The Central Bank will look closely at inflation at each of its quarterly meetings this year, Yang told legislators.