The National Development Council (NDC) reported Tuesday that Taiwan's economy grew for the seventh month in a running in August, owing to recovering domestic consumption and easing concerns about a local COVID-19 epidemic.
The country's economy is expected to increase by more than 6% this year, Finance Minister Su Jain-rong said. Su provided a prognosis that was slightly more positive compared to the central bank's forecast last week.
He made the remark while fielding questions from legislators in parliament.
Taiwan's central bank elevated its current-year projection for gross domestic product growth to 5.75% from the 5.08% estimate in June.
Based on NDC statistics, the composite index of monitoring indicators, which reflects the current economic situation, jumped one point from the previous month to 39 in August, flashing another "red light" that indicated a score of between 38 and 45.
The leading indicators increased 0.15 month over month to 101.74 in August, reversing a seven-month downward trend, the statistics showed.
Taiwan's GDP grew by 7.43% in the second quarter of 2021, owing to a partial shutdown aimed at preventing the spread of local COVID-19 infections.
The NDC employs a five-color scheme to assess the economy, with blue suggesting contraction, yellow-blue indicating sluggishness, green showing stable growth, yellow-red suggesting a warming economy, and red an overheated or booming economy.
Cathay Financial cited a study conducted from September 1 to 7 as evidence that nearly 50% of respondents believe the local economy will grow over the next six months, while 23% are optimistic it will suffer.
The study further shows that the findings translate into an economic optimism index (EOI) for the next six months of 27 for September, up from 22 from the previous month.
Meanwhile, Taiwan's central bank stated Tuesday that the Taiwan dollar's exchange rate with the US dollar has been stable this year with few big fluctuations, and that it has intervened in the market this year but at a lower rate than last year.
The currency's strength has been a source of concern not just because it raises the cost of exports from Taiwan's trade-dependent economy, but also because the U.S. Treasury included Taiwan to a "watch list" of countries whose currency practices have raised concerns in December.
