Weak Japanese yen not likely to move interest rates: central bank
May 17, 2013, 12:12 am TWN
TAIPEI -- Taiwan's central bank is unlikely to adjust interest rates in the short term even in the face of a weakening Japanese yen, according to Australia and New Zealand Banking Group Ltd. (ANZ).
“We believe the central bank will continue to ensure the 'orderly functioning' of the foreign exchange market and will emphasize stability in response to global currency volatility,” the bank said in its latest weekly research note.
The central bank's next quarterly policymaking meeting is scheduled for June. The bank left interest rates unchanged at its last meeting in March for the seventh consecutive quarter. Rates were last adjusted in June 2011, when the central bank increased the benchmark discount rate by 12.5 basis points to 1.875 percent.
With Taiwan's economic recovery sluggish and inflationary pressure limited, the central bank is expected to keep interest rates unchanged for most of the year, with the first policy rate hike forecast to take place in the fourth quarter at the earliest, ANZ said.