AI demand becomes the strongest driving force! Bank of America "doubles" its forecast for GDP growth in Taiwan, China.

Bank of America Corp has significantly raised its forecast for economic growth in Taiwan for this year. According to a report released on Tuesday by Bank of America Corp analysts including Xiaoqing Pi, the forecast for Taiwan's GDP growth rate in 2026 has been raised from 4.5% to 8%, citing "unstoppable global demand" for technology hardware produced by Taiwanese companies. Driven by demand for artificial intelligence (AI), the Taiwanese economy experienced strong growth in 2025. Even against this backdrop, the market continues to have an optimistic outlook on its growth prospects. Bank of America stated that this upward revision "reflects our continued optimistic outlook on Taiwan's tech-driven expansion and is further strengthened by recent developments," including more stable exchange rates, trade agreements with the US, and increased spending by tech companies. Bank of America Corp has joined the ranks of institutions such as Goldman Sachs Group, Inc. and Barclays PLC Sponsored ADR in taking a more optimistic view of the Taiwanese economy following its fastest growth since 2010 last year. Taiwan's economic growth in 2025 was mainly driven by exports, with officials in the region recently stating that the economy grew by over 12% in the fourth quarter of last year, the fastest since 1987. The views of institutions like Bank of America further highlight the market's optimistic expectations for continued prosperity in AI this year. Major chip manufacturer NVIDIA Corporation (NVDA.US) and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) recently announced plans to invest up to $56 billion in capital expenditure, exceeding market expectations. This announcement comes as tech giants like Alphabet Inc. Class C, Meta Platforms, and Amazon.com, Inc. continue to ramp up their AI investments. Bank of America also noted that it does not expect the Taiwanese monetary policy authorities to raise policy interest rates this year, citing "mild inflation, stagnant service industry wages, weakness in non-tech sectors, and continued cooling in the real estate market" as factors. The bank also pointed out that the forecast is subject to risks including "political developments in the GEO Group Inc."