Taiwan's business sentiment dropped to a two-year low in April, as local firms struggled to interpret US trade policy and feared "reciprocal" tariffs announced by President Donald Trump, Taipei Times reported, citing the Taiwan Institute of Economic Research (TIER).

The manufacturing index dropped by 3.53 points to 90.9, with just 18.2% of firms reporting better performance, marking a steep decline from the previous month. Although Trump announced a 90-day pause on the tariffs, lingering uncertainty has led businesses to cautiously stock up on inventory.

Optimism for the next six months slightly improved, with 22.9% of firms expecting better conditions, the report added.

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