Central bank Governor Perng Fai-nan (彭淮南) yesterday flatly rejected media speculation that the bank had stepped in to fuel the local currency's under-valuation to protect the nation's exporters.
"We didn't buy any US dollars to manipulate the New Taiwan dollar's exchange rate, which is always decided by market supply and demand," Perng said.
He said the nation's foreign exchange reserves had only increased by US$4 billion so far this year, which is smaller than the annual investment return. This was proof the bank had not been buying greenbacks, he said.
"There's no excessive supply of US dollars, which suggests we are now seeing a balanced supply and demand of US dollars," Perng said.
He refused to comment on whether the current exchange rate against the greenback -- between NT$32.2 and NT$32.3 -- was an ideal level. When asked if the central bank had sold any US dollars to prop up the NT dollar, Perng said: "I can't tell you."
Market observers view such comments as a signal that the bank has dumped some of its US dollar holdings to prop up the NT dollar's exchange rate, although selling US dollars can also be a wealth management strategy to limit losses in the face of a weakening US currency.
Dealers speculated yesterday that the central bank's preferred range for the NT dollar's exchange rate has recently narrowed, since it has bought and sold US dollars whenever the local currency rose or fell too much.
Perng also denied media reports claiming the rise in consumer prices has been too much for the central bank to stem.
"The central bank's priority has always been stabilizing the nation's consumer prices, while carefully weighing the impact of a tightened monetary policy on the local economy," he said.
On Thursday, Perng told the legislature's Finance Committee that the bank's monetary policy would have a limited effect on inflationary pressures if higher prices were a result of supply factors. He said if the bank continued to adjust its monetary policy through interest rate hikes, economic growth could be hurt.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure