Press Release Release Date: September 25, 2003

The Central Bank of China, Taipei


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For immediate release

1.The Board of Directors decided today to keep the discount rate, the rate on accommodations with collateral, and the rate on accommodations without collateral unchanged at 1.375%, 1.75%, and 3.625%, respectively.

2.Our exchange rate system is one of managed float. The NT dollar exchange rate is, in principle, determined by market forces. The Board believes that when the exchange rate exhibits undue volatility and strays from economic fundamentals, due, for example, to large and sudden movements of short-term capital, the CBC should step in to maintain the dynamic stability of the exchange rate.

3.The easy monetary policy that has been adopted by the Board over the past two years has provided considerable support to domestic economic activity. In order the keep up the momentum of the ongoing economic recovery, the CBC will continue to maintain an accommodative monetary stance. The Board perceives that, in the foreseeable future, short-term interest rates will remain at low levels that are conducive to maintaining financial stability and fostering economic growth.