Citigroup and UBS have both revised up their forecasts for Taiwan’s real GDP growth in 2026 to 9.9%, a notable increase from prior estimates and a sign that export performance has outpaced earlier expectations.
At Citi, strategist Adrienne Lui said the bank raised its 2026 real GDP forecast to 9.9%, attributing the change to "ultra-strong and broadening export momentum." The upgrade accompanies a consumer-price inflation outlook that departs from the Taiwan central bank's expectations: Citi projects consumer price inflation to climb to 2.2% in 2027 as domestic inflationary pressures build, while the central bank anticipates that inflation will ease next year.
Citi also retains the view that the central bank of the Republic of China (CBC) will initiate a tightening cycle starting in December. The bank's forecast includes three increases of 12.5 basis points each, timed for December, June 2027, and December 2027.
UBS economist William Deng likewise raised his bank's 2026 GDP forecast to 9.9%, up from a previous 8%, citing what he described as even stronger growth momentum. Deng noted that the recent peace deal between the US and Iran should help reduce uncertainties that had weighed on the outlook.
Despite the upward revision to growth, Deng expects the CBC to keep the policy interest rate unchanged. He pointed to several factors in support of that view: effective inflation smoothing by the government, modest growth in domestic loans, and generally moderate changes in housing prices. Deng added that, if necessary, the central bank could deploy selective measures aimed at specific parts of the economy: "If necessary, we believe the CBC could utilize selective measures targeting specific areas of the economy," he said.
Taken together, the revisions from Citi and UBS underscore stronger export-driven growth prospects for Taiwan in 2026 while highlighting a clear divergence in views on inflation dynamics and the likely path of monetary policy. The differing forecasts leave open uncertainty about the timing and scale of any future policy moves by the CBC.