By Crystal Hsu / Staff reporter
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Two members of the central bank’s board of directors argued for an interest-rate increase at the bank’s policy meeting last month, citing persistent inflation risks even as most policymakers said that artificial intelligence (AI)-driven economic growth did not yet warrant tighter monetary policy, minutes released yesterday by the central bank showed.The majority of the directors viewed inflation pressures as manageable, pointing to government measures to stabilize domestic prices and arguing that Taiwan’s strong economic expansion has been concentrated largely in AI-related industries, while traditional sectors and domestic demand have yet to fully recover, the minutes showed.Most believed that keeping the policy rate unchanged would preserve flexibility to respond to uncertainties including changes in global economic conditions, geopolitical risks, oil prices and weather-related supply disruptions, they showed.
A man stands inside Taiwan’s central bank in Taipei on May 29 last year.
Several stressed that although inflation risks remained, recent price increases were driven mainly by supply-side factors, limiting the effectiveness of monetary tightening in addressing those pressures.However, two directors dissented, saying that inflation had become persistent enough to justify a rate increase.
