TAIWAN: DBS Sees CBC On Hold Later Today
DBS: "The central bank is expected to maintain the policy rate at 2.00% during this meeting, with the RRR and LTV ratios on housing loans also remaining
unchanged. CPI inflation held steady at 2.1% YoY in Jan-Feb, though inflation expectations have risen due to the potential for an electricity price hike in April. Exports and manufacturing PMIs remained robust in Jan-Feb, but there are downside risks for the 2Q and 2H outlook due to growing uncertainties around US tariffs. Given the heightened economic uncertainties compared to last year, we expect the central bank to avoid raising rates to control inflation expectations as it did in March 2024. Meanwhile, indicators such as property prices and housing loans suggest that previous rounds of RRR and LTV tightening to cool the property market have had their intended effects. Therefore, there is no immediate need for the central bank to further tighten these measures at this meeting."