Sat, Jun 11, 2005 - Page 10 News List

Central bank won't diversify reserves

STAFF WRITER

The nation's central bank said yesterday that it has already diversified its currency reserves and won't extend that diversification, after a high-ranking government official earlier yesterday expressed the need to diversify Taiwan's foreign-exchange reserves rather than relying on any particular currency.

Vice Premier Wu Rong-i (吳榮義) said during an interview with Reuters yesterday that Taiwan should diversify its massive foreign-exchange reserves to minimize political and financial risks.

The nation's foreign-exchange reserves rose to a record US$253.17 billion at the end of last month, the central bank reported on June 3.

The reserves, which trail those of Japan and China, use the US dollar as the main foreign-reserve currency along with other currencies including the euro and Japanese yen.

In response, the central bank yesterday said in a statement that it has already diversified.

"Our foreign reserves have been diversified. We see no need to further the diversification," the bank said, without elaborating further.

George Chou (周阿定), director-general of the central bank's currency department, meanwhile stressed the bank's autonomy in deciding how to diversify the reserves.

"The central bank operates independently," Chou told Bloomberg in a phone interview. "There is no question about that."

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