Taiwan: AI cycle boosts growth outlook – Standard Chartered
Standard Chartered’s Tommy Wu raises Taiwan’s 2026 growth forecast to 9.5% from 7.6% after much stronger-than-expected Q1 GDP data. The AI supercycle and robust exports are seen as key drivers, while private consumption benefits from government cash handouts and a tech-led stock rally. The bank expects the CBC to keep rates at 2%, but sees higher inflation risks from stronger domestic demand.
AI supercycle drives robust expansion
"We raise our 2026 growth forecast to 9.5% (from 7.6%) to reflect a much stronger-than-expected Q1 GDP print."
"According to the advance estimate, Q1 GDP expanded 13.7% y/y (2.8% q/q), the fastest pace since 1987."
"We expect AI-related demand to remain strong, driving Taiwan’s growth."
"That said, GDP growth may slow y/y in H2, with high base effects weighing on exports and GDP, especially in Q4."
"We continue to expect the Taiwan central bank (CBC) to keep the policy rate unchanged at 2% this year, with the K-shaped economy acting as a constraint."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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