Taiwan central bank slashes key interest rate

TAIPEI — Taiwan's central bank cut the island's key lending rate by three quarters of a percentage point Thursday, the fifth rate cut in less than three months.

The bank cut the rate from 3.125 percent to 2.375 percent because of the "continuing high risk for a downturn in economic growth," according to a statement on its Web site.

Analysts had expected the bank to cut the rate by half a point.

The bank's statement said the rate cut would stimulate domestic demand.

The cut comes in the wake of a significant fall in Taiwanese exports, one of the main engines of the island's economic growth.

On Monday the Finance Ministry said exports hit a three-year low of US$16.8 billion in November, falling 23 percent from a year earlier, as the island felt the pinch from the global slowdown.

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