(Bloomberg) -- Taiwan upgraded its economic growth forecast for this year and signaled confidence for 2018, as a strong exports outlook lifts momentum.
The statistics bureau revised its estimate for 2017 gross domestic product to 2.11 percent, up from the previous projection of 2.05 percent in May and closer to the central bank forecast of 2.13 percent. The bureau also said it expected output to rise 2.27 percent in 2018, according to a statement on Friday.
"As a key segment of the global electronic and technology supply chains, Taiwan is a clear beneficiary of increasing global trade," said Aidan Wang, an economist at Cathay Securities Investment Trust in Taipei. Wang said the central bank is likely to keep interest rates unchanged until early next year as inflation remains moderate.
Taiwan’s economy has been bolstered by a strong export performance this year, with Apple Inc. poised to release the newest model of its flagship iPhone in the fall, lifting suppliers on the island. At the same time, domestic investment and consumption remained sluggish, keeping central-bank policy accommodative.
"The global recovery is gathering momentum and international trade has warmed up," the statistics bureau said in a statement, adding that external demand will increase in the second half of this year. Economic uncertainties include impacts of Federal Reserve policy, China-Taiwan relations, raw material prices, and geopolitical risks, the agency said.
GDP rose 2.13 percent in the second quarter from a year earlier, according to the final reading released by the bureau on Friday, versus a preliminary reading of 2.1 percent. Taiwan’s central bank in June kept the key interest rate unchanged for a fourth straight quarter.
With assistance from Chinmei Sung, Xiaoqing Pi