DBS Bank (Taiwan) has maintained its forecast for Taiwan’s 2026 economic growth at 11.6%, citing continued spending on artificial intelligence as a key driver of exports and investment.
The bank’s 2027 projection remains unchanged at 5.6%, with expected consumer price inflation of 2% this year and 2.1% next year.
Ma Tieying, a senior economist at DBS Group, noted that high-frequency data indicates third-quarter GDP growth of about 12%, compared to 12.9% in the second quarter and a peak of 15.4% in the first.
Ma Tieying expects growth to ease to the high single digits in the final quarter, as large cloud providers face cash flow pressure and higher interest rates increase investment costs.
Taiwan’s chipmakers are expected to remain competitive in the near term due to their advanced process technology and strong client ties, despite China’s rapid progress in AI models and infrastructure.
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Ma Tieying also cited gains on the local stock market, improved profits in the financial sector, and faster wage growth as factors supporting household spending.
Third-quarter inflation reached 2.4%, with energy prices and US tariffs posing the main risks to the economy.
Chen Yu-chia, a senior vice president at DBS Bank (Taiwan), predicted that the US Federal Reserve will raise rates by 25 basis points in both December and the first quarter of 2027, taking the federal funds rate to 4.5%.
DBS set a year-end gold target of $4,800 per ounce, with prices expected to reach $5,200 to $5,300 in the first quarter of next year, and recommended that investors hold 5% to 10% of their portfolios in gold.
