Taiwan Dollar Stays Put Amid Hawkish Tone and Rebounding Equities

Taiwan's central bank kept its policy rate at 2% for a tenth consecutive quarter, maintaining a mildly hawkish tone. The bank raised its 2026 growth forecast to 11.48% and lifted inflation projections while highlighting sticky services inflation.

The Taiwan dollar held steady after the Federal Open Market Committee (FOMC) US dollar strength, bolstered by a rebound in local equities and the return of foreign equity inflows.

Near-term USD/TWD moves are expected to be driven by foreign equity flows, tech sentiment, and the broader US dollar direction rather than monetary policy. The central bank's decision did not indicate an imminent rate rise.