Taiwanese inflation to have remained subdued in January, exports likely stayed in negative territory

The Taiwanese inflation and trade data for the month of January are set to release this week. According to a DBS Bank research report, export growth is likely to have stayed in the negative territory for the third straight month in January, falling 0.2 percent year-on-year. Meanwhile, the consumer price inflation is expected to have come in at 0.3 percent.

The deterioration in Chinese demand, deceleration in electronics cycle, softness in commodities prices, and lingering of U.S.-Chinese trade tensions might probably continue to negatively impact Taiwanese exports in the first quarter.

While festive demand might stimulate inflation during the Chinese New Year period, underlying prices pressures might continue to stay muted until oil prices recover, noted DBS Bank.

“The Directorate General of Budget, Accounting and Statistics will review the 2019 economic forecasts this Wednesday. Brace for a downward revision in the 2019 GDP growth forecast from 2.4 percent to 2.0 percent or even lower (DBSf: 1.9 percent)”, added DBS Bank.