Taiwan's central bank is edging toward raising interest rates, which is bad news for borrowers and the housing market but could help savers hurt by rising prices.

• Fed chair Kevin Warsh sounded tough on inflation at the global central bank meeting, and markets now think a September US rate hike is back on the table.
• More than half the items in the US inflation basket rose over 3% in the past year, so the Fed may keep rates high for longer instead of cutting.
• In Taiwan, inflation is now running above interest rates, meaning savers lose money by holding cash — a classic trigger for a hike.
• Taiwan's central bank has "its foot on the pedal" but has not pressed down; double-digit growth and sticky wages and service prices make a hike easier to justify.
• Even without an official move, borrowing and loan rates have already crept up as money gets tighter.

Outlook: August inflation data is the key test — if prices stay above 2%, especially in services, Taiwan is likely to hike.