TAIPEI Taiwan's central bank raised its policy rate on Thursday in a surprise move that showed continued concern about inflation despite recent turmoil on global financial markets, and cut its outlook for the island's economic growth this year.
The benchmark discount rate was raised by 12.5 basis points bps to 1.875 per cent in a unanimous decision by the central bank.
Economists had expected the central bank to stand pat, though eight of the 24 economists who surveyed said the central bank would lift the rate to 1.875 per cent.
The decision came after the U.S. Federal Reserve raised interest rates by a quarter of a percentage point, but indicated that it was on the verge of pausing further increases in borrowing costs after the collapse of two U.S. banks.
The central bank of Taiwan cut its 2023 forecast for economic growth to 2.21 per cent from its previous forecast of 2.53 per cent in December.
It raised its consumer price index forecast for this year to 2.09 per cent from a previous prediction of 1.88 per cent.