Jan. 28 (Bloomberg) --Taiwan’s economy expanded at a faster-than-estimated pace in the fourth quarter last year, as a recovery in Europe and the U.S. boosted the island’s exports.
Gross domestic product rose 2.92 percent from a year earlier after increasing 1.66 percent in the third quarter, the statistics bureau said in a preliminary report in Taipei today. The median estimate of 18 economists in a Bloomberg News survey was 1.83 percent.
The World Bank this month raised its global growth forecasts as the easing of austerity policies in advanced economies supports their recovery. Taiwan’s finance ministry last week revised its exports figures for the fourth quarter and full year to reflect missing data, showing sales climbed 1.4 percent in 2013 after shrinking 2.3 percent the previous year.
“The economy did really see an export bounce in the fourth quarter and the net effect of the export bounce is that it pushed up GDP in the fourth quarter,” said Wai Ho Leong, a Singapore-based economist at Barclays Plc. “Taiwan tends to have a very strong correlation with global cycles, particularly the U.S.,” and overseas demand will continue to recover this year, led by resurgent spending on technology, he said.
The Taiwan dollar has weakened about 2 percent this year. The benchmark Taiex Index fell 1.6 percent yesterday, the last day of trading before the Lunar New Year holidays.
The central bank held the benchmark interest rate for a 10th straight meeting in December, the longest period of inaction according to its data going back to 1980. The monetary authority has said it would maintain order if excessive volatility endangers financial stability, after the Federal Reserve said it would reduce its monthly bond purchases.
President Ma Ying-jeou has sought closer trade and investment ties with China, Taiwan’s biggest trading partner, while also diversifying its economic allies through trade agreements with Singapore and New Zealand. Taiwan Semiconductor Manufacturing Co., the world’s largest custom maker of chips, said it expects full-year sales and profit to climb at least 10 percent this year as demand for mobile devices rises.
The economy expanded a seasonally-adjusted 2.43 percent in the fourth quarter from the previous three months, today’s report showed. Private consumption increased 3.25 percent from a year earlier and manufacturing rose 2.63 percent.
The economy expanded 2.19 percent in 2013, compared to 1.48 percent the previous year, today’s report showed. The statistics bureau is due to report final data on Feb. 18.
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