Taiwan Posts Second-Straight Expansion on Electronics Demandby
Economy expaned 2.06% in the third quarter from a year earlier
Central bank has held main rate at a six-year low of 1.375%
Taiwan’s economy picked up in the three months through September as domestic consumption firmed and global demand for its electronics and machinery exports rebounded.
Gross domestic product rose 2.06 percent in the third quarter from a year earlier, preliminary data released by the statistics bureau showed Friday. That compares with a median estimate of 1.8 percent growth in a Bloomberg survey, and follows a 0.7 percent gain in the second quarter. The government in August raised its full-year GDP forecast to 1.22 percent from 1.06 percent.
The second straight expansion follows three quarters of contraction through the first quarter of this year. Central bank policy makers held the benchmark rate at a six-year low of 1.375 percent in September, with rising oil prices and strong sales of Apple Inc.’s new iPhone 7 boosting export demand and industrial production. Unemployment and inflation have declined for two consecutive months.
"Growth momentum will filter through the fourth quarter, but 2017 should only see a gradual rebound," with demand for Apple products helping to support growth, said Angela Hsieh an emerging-markets economist at Barclays Plc in Singapore. "Headwinds remain, particularly in the tourism industry, as the number of Chinese visitors has hardly improved."
Taiwan’s central bank said in a September report that downside risks to the economy include falling tourism from mainland China and low trading volume in the island’s stock market. Central bank governor Perng Fai-nan also said his current term, which expires in 2018, would be his last.
Growth fared better than forecast in August because of better-than-expected domestic demand including consumption and investment, the statistics bureau said in a statement released in Taipei.