TAIPEI (TVBS News) — The Taiwan Institute of Economic Research (TIER, 台經院) reported Wednesday (March 25) that February's business climate indices fell across all three major industries, ending months of gains. TIER President Dr. Chang Chien-yi (張建一) warned that international oil prices may persist at US$100 (around NT$3,189) per barrel despite the Middle Eastern war's end. This price level puts upward pressure on Taiwan's consumer price index (CPI), though the Lunar New Year holiday primarily drove the synchronized downturn.
The manufacturing index fell to 96.41, dropping 2.10 points and ending a seven-month rise, according to TIER's survey. The service sector decreased slightly to 94.55, halting a four-month upward trend, while the construction industry experienced the steepest decline of 4.11 points to 95.81. Sun Ming-Te (孫明德), director of TIER's Macroeconomic Forecasting Center, attributed the decline mainly to fewer working days during the Lunar New Year holiday, though the U.S.-Iran conflict continued to impact the economy.
Sun noted that manufacturers generally remain optimistic, believing the Middle Eastern conflict will not last long despite current challenges. Dr. Chang emphasized that global energy stability issues and high international oil prices challenge both global and Taiwan's prices, adding pressure on the CPI. The Ministry of Economic Affairs (MOEA), Taiwan's economic policy agency, has scrambled to secure energy supplies, though damaged Middle Eastern facilities hinder a swift recovery.
Taiwan's central bank projected a 7.28 percent economic growth rate for the year on March 19, with Dr. Chang attributing the growth mainly to artificial intelligence (AI) demand. The war has minimally affected Taiwan's AI-driven economic expansion, according to TIER's analysis. Liu Pei-Chen (劉佩真), director of TIER's Taiwan Industry Economics Services, expressed skepticism about the central bank's relaxed loan-to-value ratios reversing the sluggish real estate market. Liu cited cautious bank valuations that offset potential benefits from the policy change. ◼ (At time of reporting, US$1 equals approximately NT$31.89)