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Updated Friday, April 1, 2011 11:59 pm TWN, CNA

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Central bank raises interest rates by 12.5 basis points

TAIPEI -- Taiwan's central bank announced a hike in interest rates by 12.5 basis points Thursday, effective the following day.

The bank made the upward adjustment — the fourth since the second quarter of last year — after a meeting of its board of directors and supervisors.

After the adjustment, Taiwan's rediscount rate will be 1.75 percent, while rates on accommodation with and without collateral will be 2.125 percent and 4 percent, respectively.

The bank had previously lowered interest rates by a combined 2.375 percentage points in seven consecutive adjustments from September 2008 amid the global financial meltdown.

It stopped cutting the rediscount rate further in the second quarter of 2009 and had since maintained it unchanged at 1.25 percent for five consecutive quarters.

Since Q2 last year, it began to raise the prime rates by 12.5 basis points on a seasonal basis.

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