Taiwan’s exports likely to have grown positively in December, inflation to have accelerated slightly

Taiwan’s December trade and inflation data are set to release tomorrow. According to a DBS Bank research report, exports growth is likely to have come in positive for the second straight month, at 2.9 percent year-on-year. The overall overseas demand conditions continue to be soft, as seen by the further fall in export orders in November 2019. However, onshore manufacturing activity continue to outperform.

The bottoming-out of electronics cycle, rise in 5G demand, as well as the trade diversion effects of the China-U.S. trade/Japan-South Korea trade tensions, should continue to underpin Taiwan’s exports, production and investment growth in the near term, said DBS Bank.

Meanwhile, Taiwan’s headline inflation is likely to have remained tame, owing to the stable labor market conditions and the strengthening of TWD countering higher oil prices.

“CPI inflation is projected to register 1.0 percent in Dec19 vs 0.6 percent in Nov19”, added DBS Bank.