Taiwan earthquake hit local chip production, but only temporarily
Taiwan was hit by the 7.2 magnitude earthquake on 3 April, the strongest in 25 years. However, the economic impact seems to be manageable so far, thanks to sparse population close to the epicentre, improving building codes and stronger disaster management and awareness in the past two decades.
What you will learn:
- Being the global chip fabrication hub, Taiwan’s chip production was once interrupted after the earthquake but reported no material damage to main production lines. Local chip makers have responded quickly and resumed most of the production lines since the earthquake.
- The four-days’ Qingming holiday right after the earthquake shows domestic consumption remained resilient. Agricultural prices may go up in the month because of traffic disruptions after the earthquake, adding further pressure to domestic prices following the scheduled electricity price hike in April.
- We maintain our 2024 growth forecast of 2.8% for Taiwan and continue to expect the central bank to hike rate by 12.5bps in Q2.
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