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The USD/TWD currency pair is expected to hold at levels of around 30.40-30.70 in the coming months after the Central Bank of the Republic of China (Taiwan) (CBC) remained on hold, Commerzbank reported.
The Central Bank of the Republic of China (CBC) stayed on hold at 1.375 percent yesterday as widely expected. It cut rates by a combined 50 basis points between Q3 2015 and Q2 2016, but has kept on hold since. CBC noted that the inflation outlook is subdued, with TWD gains helping to cap imported inflation, and that the real interest rate remains at an appropriate level.
"With Taiwan’s ongoing growth recovery not sustaining as yet, we expect CBC to maintain its accommodative policy stance by staying on hold throughout the year," the report said.
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