Taiwan’s central bank maintains a 2% policy rate amid 12.9% GDP growth and strong AI-driven exports, supporting TWD stability.
Taiwan’s dollar (TWD) remains fundamentally supported by surging AI-related exports and a robust external surplus, driving 12.9% year-over-year GDP growth in Q2. The government recently revised its 2026 growth forecast upward to 11.05%, reflecting strong investment and trade momentum.
The Central Bank of the Republic of China (CBC) is expected to keep its policy rate unchanged at 2% during its 17 September meeting, despite stellar economic performance. Inflation remains contained at around 2.1%, reducing pressure for monetary tightening. The CBC intervened in July to smooth capital flow volatility, keeping TWD broadly flat against USD year-to-date.
Analysts anticipate USD/TWD to consolidate within a 31.50-32.00 range near term, with modest downside risks if broad USD weakness persists. The macro backdrop remains supportive of TWD due to strong exports and a large external surplus, though further appreciation may be tempered by CBC intervention.