Taiwan's growth forecast cut to 2%

This is amidst weakness in overseas demand and the deterioration of trade competitiveness, says DBS.

DBS Group Research noted:

Growth forecast for 2012 is cut to 2.0% from 2.9%, well below the official estimate of 3.03% and the consensus of 2.93%.

There are twin challenges confronting the export sector – the weakness in overseas demand and the deterioration of trade competitiveness.

Consumption growth may also lose steam in the near term, due to the external slowdown and domestic fiscal consolidation.

The central bank has limited flexibility to loosen monetary policy.

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