Economic Highlights (Taiwan) - 30/04/2014

Taiwan: Economic Activity Continued to Expand at a Modest Pace

• The economy grew at a relatively moderate pace in the first quarter.
• Preliminary GDP showed an expansion of 3.04% yoy in 1q or a seasonally adjusted annual rate of 1.07%, mainly driven by consumer spending and exports.
• Mar indicators also suggested a continuing slow recovery in economic activities, with subdued growth in exports, industrial production and commercial sales.
• On the positive side, export orders held up in Mar amid increased demand from Europe, Japan and ASEAN-6.
• Consumer confidence also rose to the highest level in more than two years, although employment expansion remained slow. Core inflation continued to be low despite higher headline inflation.
• The CEPD’s economic monitoring indicator flashed a “green” signal for the second successive month in Mar, implying that the economy is in a period of “stable economic growth”.
• We maintain our GDP growth forecast of 3.0% and CPI inflation forecast of 1.5% for 2014, compared with government forecasts of 2.82% and 1.07%.

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