The NT dollar advanced the most in six weeks as economists predicted exports grew for a 13th month, boosting speculation investors will increase holdings of Taiwan’s assets.
The currency gained for a third day as Federal Reserve Chairman Ben Bernanke said the purchase of more bonds beyond the US$600 billion announced last month is “certainly possible,” according to a transcript of an interview on CBS Corp.
Overseas shipments rose 18.9 percent last month from a year earlier, compared with an increase of 21.9 percent the previous month, according to the median estimate of economists in a Bloomberg survey before a Ministry of Finance report tomorrow. Bonds gained.
“Economic data is still in a healthy situation,” said Yili Tang, head of the currency division at Shinkong Life Insurance Co (新光人壽) in Taipei. “Hot money will come into Asia, no doubt. The central bank will control the market.”
The NT dollar ended 0.4 percent stronger at NT$30.625 against its US counterpart, according to Taipei Forex Inc. The currency has appreciated 3.4 percent so far this quarter, the best performance among Asia’s most-traded currencies.
Overseas funds bought US$102 million more Taiwanese stocks than they sold yesterday, boosting net purchases this year to US$7.06 billion, exchange data showed.
Taiwan’s currency was up 2 percent a minute before the close and later trimmed gains as the central bank sold the local dollar, said a trader familiar with the authority’s operations, who declined to be identified.
The NT dollar has pared gains or weakened in the final minutes of trading on most days in the past eight months as policy makers bought the US dollar, according to traders familiar with the central bank’s operations who declined to be identified. Central banks intervene in currency markets by arranging purchases or sales of foreign exchange.
The yield on the 2 percent note due in July 2015 fell one basis point to 0.990 percent, according to GRETAI Securities Market, the nation’s biggest exchange for bonds. A basis point is 0.01 percentage point.
Meanwhile, China’s yuan rose against the US dollar ahead of a meeting of European finance ministers to discuss expanding the region’s bailout fund to curb the debt crisis.
The People’s Bank of China (中國人民銀行), which manages the exchange rate using a basket of currencies of major trading partners, set the yuan rate 0.1 percent higher at 6.6515 yuan against the US dollar, stronger for a third day. Belgian Finance Minister Didier Reynders said on Saturday the US$1 trillion fund may be increased if ministers decide to introduce a larger permanent facility.
“Europe will continue to be the dominant issue,” said Patrick Perret-Green, head of Asian foreign-exchange strategy at Citigroup Inc. “The yuan has only appreciated mildly compared to the bounce of other currencies against the dollar.”
The yuan rose 0.2 percent to 6.6477 yuan per US dollar as of 6pm in Shanghai, according to the China Foreign Exchange Trade System.
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
CORPORATE SCANDAL: Cathay Life has invested NT$13.3 billion in Bank Mayapada since 2015, but the latest loss of NT$8.8 billion has completely written off its investment Cathay Life Insurance Co (國泰人壽) yesterday said it would recognize an investment loss of NT$8.8 billion (US$298.1 million) in Indonesia’s Bank Mayapada Internasional Tbk PT due to concerns about the lender’s operations amid a corporate scandal. The company said it would revise its earnings result for June, from a net profit of NT$6.52 billion to a net loss of NT$520 million, its first monthly loss over the past 17 months. After booking an investment loss of NT$5.2 billion in Bank Mayapada earlier this year, Cathay Life has so far recognized total investment losses of NT$14 billion in the lender, executive vice president
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported that revenue last month expanded 25 percent annually, but fell 12.8 percent month-on-month to NT$105.96 billion (US$3.59 billion). In the first seven months of this year, the chipmaker’s revenue surged 33.6 percent to NT$727.26 billion, compared with NT$544.46 billion a year earlier. TSMC has said it aims to grow its revenue by more than 20 percent this year. The company has since May 15 stopped taking new orders from Huawei Technologies Co (華為), its second-biggest customer after Apple Inc, due to the US’ restrictions on exports containing US technologies. TSMC has no plans to