Taiwan c.bank reiterates loose policy comment

TAIPEI, Aug 20 (Reuters) - Taiwan's central bank said on Thursday it was still maintaining a loose monetary policy for now, reiterating its comments made this year and prompting the market to expect interest rates at stay at a record low.

'Financial figures show that our banking system has ample liquidity as we have still keeping to a loose monetary policy,' the central bank said in a statement.

The central bank was responding to media reports saying it might be tightening its monetary policy after keeping it loose since late last year.

From September last year to February this year, the central bank has cut its main policy rate seven straight times to a record low of 1.25 percent as exports slumped during the steep global recession.

It then kept the rate unchanged in March and June in order not to compromise a nascent recovery in the technology-reliant economy.

Most economists expect the rate to hold steady for the rest of this year as the economy is just starting to see significant recovery, with the economy posting its first GDP growth in over a year in the second quarter on an annualised basis.

(Reporting by Lee Chyen Yee; editing by Chris Pizzey)

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