Asian currencies gained for a second week, approaching an almost 15-month high, as optimism that US lawmakers would resolve a budget deadlock supported demand for emerging-market assets.
US Senator Chuck Schumer said on Thursday there had been progress in talks to avert US$600 billion in spending cuts and tax increases as US President Barack Obama said this week he hoped for an agreement before Christmas.
The New Taiwan dollar edged up 0.2 percent to NT$29.116 against the greenback, its second weekly advance. Strong institutional buying in the local stock market boosted demand for the local currency, but its advance was tempered by the central bank’s continued intervention in an effort to boost the nation’s export competitiveness global competitive edge, dealers said.
India’s rupee had its best week since June after Moody’s Investors Service affirmed its stable rating outlook. It rallied 2.3 percent from a week ago to 54.2650 per US dollar in Mumbai, according to data compiled by Bloomberg.
Indonesia’s rupiah ended a six-week slump, gaining 0.6 percent to 9,594, and Malaysia’s ringgit strengthened 0.7 percent to 3.0380. South Korea’s won rose 0.3 percent to 1,082.85.
China’s yuan traded at a 19-year high, climbing 0.04 percent this week to 6.2267 per US dollar, according to China Foreign Exchange Trade System. It touched a 1993 high of 6.2223 on Tuesday and tested the upper limit of its trading band on each of the five days.
“There’s pent-up demand for the yuan,” said Andy Ji, a Singapore-based foreign-exchange strategist at Commonwealth Bank of Australia. The currency is also supported by a trade surplus that has surpassed US$180 billion this year, he said.
The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding Japan, rose for a sixth month.
“The biggest driver is the US fiscal situation,” said Sean Yokota, the Singapore-based head of Asia strategy at Skandinaviska Enskilda Banken AB. “If you look at a one-month time horizon, we think they’ll reach a deal on the fiscal cliff, so Asian currencies will probably continue to appreciate.”
Global investors added US$827 million of new money into emerging-market bond funds in the week through Wednesday, EPFR Global data showed.
Foreigners were net buyers of stocks in Taiwan, India, the Philippines and Thailand this month.
Elsewhere, the Philippine peso appreciated 0.4 percent from a week ago to 40.895 per US dollar before a public holiday on Friday. Thailand’s baht was little changed at 30.69 per US dollar, as was Vietnam’s dong at 20,850.
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
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