Head of Taiwan's central bank gets 1st B+ grade from Global Finance

Taipei, Oct. 11 (CNA) Yang Chin-long (楊金龍), governor of the Central Bank of the Republic of China (Taiwan), was given a B+ grade by the New York-based Global Finance magazine after four years of A's.

In the Central Banker Report Cards 2024 released overnight, the magazine noted that the Taiwan central bank's decision to raise the policy rate from 1.875 percent to 2 percent in March, and Yang's remark about the tightening measure were a "little surprising."

However, the magazine said that "the central bank's monetary tightening campaign has been explicit," citing the six discount-rate hikes totaling 87.5 basis points and three reserve ratio requirement increases totaling 75 basis points in Taiwan between March 2022 and June this year.

Global Finance further pointed out the weak Taiwan dollar's impact on inflation, with the annual increase in the consumer price index (CPI) hitting a high of 3.08 percent in February and the Taiwanese currency declining more than 6 percent between July 1, 2023 and June 30, 2024.

The magazine also said the monetary tightening has slowed down the core CPI increase to 1.99 percent in July. The year-on-year CPI growth further eased to 1.82 percent in September from a year earlier, while core CPI, which excludes fruit, vegetables and energy, rose 1.79 percent during the same period, according to the latest government statistics.

In the Asia-Pacific region, Reserve Bank of New Zealand Governor Adrian Orr was also given a lower B+ grade for 2024 compared with an A in 2023, while Bank of Korea Governor Rhee Chang-yong was given a B+ after receiving an A- in 2023.

Global Finance said its 2024 report cards reflected the central bankers' performance during that 12-month period, which the magazine described as "very challenging" because the central banks were not only fighting inflation but also trying to avoid a recession.

"It has been a complicated balancing act between growth and inflation for most governors," the magazine said, because they had to pay extra attention to issues beyond their mandates, including responding to other central banks' moves, weighing the possibility and risk of taking an independent stand with their interest rates, and preparing for a new monetary policy based on expectations of lower economic growth and lower inflation.

According to Global Finance, its editors grade the world's leading central bankers from A to F for success in areas such as inflation control, economic growth goals, currency stability and interest rate management, with A+ being the highest grade and F the lowest.

The three central bankers who received the top score of A+ in 2024 are Denmark's Christian Kettel Thomsen, Shaktikanta Das of India, and Thomas Jordan of Switzerland. Thomsen was graded for the first time since he took office in early 2023.

It was the second A+ for Das, under whom the inflation eased to 3.54 percent in July and met the Reserve Bank of India's target 4 percent range for the first time in five years, the magazine said.

It was also the second A+ for Jordan, as Global Finance called the Swiss National Bank as a trendsetter in the developed world for "achieving a perfect balance between economic growth and inflation."

Yang, who has worked for Taiwan's central bank since 1989 and became its governor in 2018, received an A grade in 2019, 2020 and 2022, and an A- in 2021.

His predecessor Perng Fai-nan (彭懷南) has the distinction of being the only central banker in the world to have earned the top grade 14 times since the annual report was first released in 1994, gaining straight A's from 2005-2017.