World News

Taiwan January exports seen dropping, inflation at 16-month high: Reuters poll

TAIPEI (Reuters) – Taiwan’s exports are likely to have contracted in holiday-shortened January from a year earlier, according to a Reuters poll, after a bigger-than-expected 4% increase in the prior month.

Taiwan is one of Asia’s major exporters, especially of technology goods, and its export trend is a key gauge of global demand for technology gadgets worldwide.

Following the week-long Lunar New Year holiday, exports are estimated to have declined 5% on-year, compared with a growth of 4% in December.

The trade-reliant island’s inflation rate in January is estimated to stand at 1.25%, the highest since September 2018, according to the median forecast of 14 analysts surveyed by Reuters.

Taiwan’s growth outlook has improved, boosted by recovering global demand for electronics and factory relocations as some manufacturers move factories from China back to Taiwan to avoid higher U.S. tariffs on Chinese-made goods.

The island’s economy grew at the fastest pace in one-and-a-half years in the fourth quarter of 2019, after its two largest trading partners – China and the United States – signed a Phase 1 trade agreement last month after a bruising tariff war.

(Poll compiled by Carol Lee; Reporting by Yimou Lee; Editing by Sherry Jacob-Phillips)