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Investing.com -- Bank of America (BofA) anticipates continued subdued core inflation in Taiwan, stating that the rise in food prices is temporary and advises a more focused examination of the core inflation.
The bank also noted that a persistently strong Taiwan dollar (TWD) will contribute to disinflationary pressure, making imports, particularly energy products, less expensive and possibly impacting exports due to diminished demand.
The tech export sector is expected to maintain its competitiveness, according to BofA. However, the bank warns that a robust TWD could negatively affect non-tech exporters and suppress overall demand.
While the strength of the TWD could be beneficial for importers, particularly of energy products, the potential downside is a decrease in export demand, which could hit non-tech exporters hard.
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