East Asia Econ

Taiwan – growth up, now inflation too

Today's Q1 GDP data show the economy growing more quickly than any time in over 40 years. The government thinks that continues: in the forecast, downside risk from Iran isn't mentioned, but trickle down from semi to the real economy is. CPI was also revised up, even if it remains (just) below 2%.

Paul Cavey

May 29, 2026 • 3 min read

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East Asia Today

Highlights of three longer notes today: a thematic look at the regional drivers of inflation (it isn't just energy); mixed end-month data in Korea; and very strong Q1 GDP in Taiwan, with a bullish government forecast for 2026. Also, some charts summarising all the many data releases today in Japan.

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Korea – mixed month-end data

Two of the key issues for the economy are whether the chip boom trickles down, and what damage the Iran war will cause. April data show a bit of both. ICT capex rose for the third month, and there were more signs of a floor in the labour market. Overall output fell, but remained above the Q1 average

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Region – inflation risks

Big oil price hikes matter, but have been seen before. It is the rise in chip prices, and the gap between surging trade surpluses and weak currencies, that is unprecedented. If fx markets don't price these developments, central banks and fixed income will have to do so instead.