Reported 9 months ago
As of June 26, 2024, the New Taiwan Dollar ended at 32.554, a significant depreciation of 1.11 cents, hitting a new low since the end of April. The Fed's hawkish stance, indicating no rush to start a rate cut, supported the US dollar index to stabilize at 105, causing Asian currencies to weaken across the board. The New Taiwan Dollar started trading lower due to continued strong foreign capital outflows, breaking through the 32.5 mark. Despite export businesses initially selling off currency, the Central Bank's intervention was not enough to counter the outflow pressure, resulting in a closing rate of 32.554, marking a new low since late April, with total turnover expanding to US$2.471 billion. Market expectations of a rate cut in September contrast with frequent hawkish remarks from Fed officials, driving the US dollar index to rise, reaching 105.8. Foreign non-US currencies weakened entirely, with the yen nearing 160 against the dollar and the offshore renminbi hitting 7.2957. Market participants observed that while the stock market closed up by 110 points, the forex market saw a different performance. The New Taiwan Dollar depreciated from the opening due to early foreign capital outflows, intensified by significant selling pressure in the afternoon leading to the currency hitting a low of 32.558. The Central Bank intervened but the depreciation was more severe than expected, hitting a new low since April 30. There is concern over whether export businesses can withstand the strong foreign capital outflow, with the focus now on defending the 32.6 level. Looking ahead, the upcoming Personal Consumption Expenditure Price Index (PCE) announced at the end of the week could impact the forex market in July, potentially influencing the movement of the US dollar and the New Taiwan Dollar based on inflation trends.
Source: YAHOO