The central bank said it’s monitoring the weakness in the euro, Spencer Lin (林孫源), head of the central bank’s foreign exchange department, told reporters in a briefing in Taipei yesterday.
Lin declined to disclose how much of Taiwan’s foreign exchange reserve is in euros, or whether the central bank plans to reduce the amount of euros it holds.
Foreign exchange reserves rose US$2.57 billion, or 0.7 percent, to a record US$360.12 billion last month compared with US$357.56 billion in April, the central bank said yesterday.
“The main factor responsible for the increase in foreign exchange reserves in May 2010 is returns from foreign exchange reserves management,” the bank said in a statement.
The euro depreciated almost 20 percent from last year’s peak in November as investors questioned its role as a reserve currency to rival the US dollar as well as the European Central Bank’s ability to defend its legal tender.
In Taipei trading yesterday, the NT dollar fell against the US dollar, reversing earlier gains, as the central bank intervened in the final minute of trading to support exporters. Lin said the central bank asked lenders to provide documents for currency forwards contracts in a move to curb speculation.
The NT dollar weakened 0.2 percent to NT$32.35 against its US counterpart as of the 4pm close local time, according to Taipei Forex Inc. The currency earlier advanced as much as 0.4 percent. It reached NT$32.418 on June 1 and June 2, the weakest level since Dec. 22, and was 0.5 percent down for the week.
“The Taiwan dollar is fully under the control of the central bank,” said Tarsicio Tong (湯健揚), a currency trader at Union Bank of Taiwan (聯邦銀行).
“Exporters always like to sell the US dollar at a higher level. They just take a look at what the central bank does. The next day, they can sell at a higher price,” he said.
Separately, the Ministry of Finance plans to sell NT$40 billion (US$1.2 billion) in 10-year bonds on Thursday next week, and the central bank will auction NT$100 billion of 364-day certificates of deposit on Friday next week to absorb market liquidity.
DAMAGE REPORT: Global central banks are assessing war-driven inflation risks as the law of unintended consequences careens around the world, spiking oil prices Central banks from Washington to London and from Jakarta to Taipei are about to make their first assessments of economic damage after more than two weeks of conflict between the US and Iran. Decisions this week encompassing every member of the G7 and eight of the world’s 10 most-traded currency jurisdictions are likely to confirm to investors that the specter of a new inflation shock is already worrying enough to prompt heightened caution. The US Federal Reserve is widely expected to do exactly what everyone anticipated weeks ahead of its March 17-18 policy gathering: hold rates steady. The narrative surrounding that
PRICE HIKES: The war in the Middle East would not significantly disrupt supply in the short term, but semiconductor companies are facing price surges for materials Taiwan’s semiconductor companies are not facing imminent supply disruptions of essential chemicals or raw materials due to the war in the Middle East, but surges in material costs loom large, industry association SEMI Taiwan said yesterday. The association’s comments came amid growing concerns that supplies of helium and other key raw materials used in semiconductor production could become a choke point after Qatar shut down its liquefied natural gas (LNG) production and helium output earlier this month due to the conflict. Qatar is the second-largest LNG supplier in the world and accounts for about 33 percent of global helium output. Helium is
About 1,000 participants, including more than 200 venture capitalists, joined the Taiwan Demo Day in Silicon Valley on Saturday, the largest iteration to date of the event held ahead of Nvidia Corp’s annual GPU Technology Conference which runs from today to Thursday. Taiwan Demo Day, co-organized by the Taiwan Next Foundation and the Startup Island Taiwan Silicon Valley Hub, took place at the Computer History Museum in California, showcasing 12 teams focused on physical artificial intelligence (AI) and agentic AI technologies. Katie Hsieh (謝凱婷), founder of the Taiwan Next Foundation, said the event highlighted the strength of the Taiwan-US start-up ecosystem, with
DOMESTIC COMPONENT: Huang identified several Taiwanese partners to be a key part of Nvidia’s Vera Rubin supply chain, including Asustek, Hon Hai and Wistron Nvidia Corp chief executive officer Jensen Huang (黃仁勳), addressing crowds at the company’s biggest annual event, unveiled a variety of new products while predicting that its flagship artificial intelligence (AI) processors would help generate US$1 trillion in sales through next year. During a two-and-a-half-hour keynote address, Huang announced plans to push deeper into central processing units (CPUs) — Intel Corp’s home turf — and introduced semiconductors made with technology acquired from start-up Groq Inc. The company even said it was developing chips for data centers in outer space. At the heart of Huang’s speech was the message that demand for computing power
RSS