Asian currencies tumbled the most in 21 months this week as US Federal Reserve Chairman Ben Bernanke said the central bank would probably taper stimulus that has driven fund flows to emerging markets.
India’s rupee touched a record low and Malaysia’s ringgit had its worst week in three years after Bernanke said on Wednesday that US$85 billion a month of debt purchases, also known as quantitative easing, may be trimmed this year and end next year if the US economy performs in line with Fed estimates.
The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies, dropped 1.1 percent since June 14 to 115.51 in Hong Kong, the biggest decline since Sept. 23, 2011.
The New Taiwan dollar weakened 1 percent to NT$30.280 per US dollar. The rupee retreated 2.9 percent to 59.2675 against the greenback, the ringgit fell 2.7 percent to 3.2 and the Philippine peso lost 2.1 percent to 43.735.
“The prospect of less quantitative easing has caused outflows and a selloff in Asian assets,” said Tobby Lin, a fixed-income trader at Yuanta Securities Co (元大證券) in Taipei. “The countries that had experienced the most inflows, like South Korea and Southeast Asian nations, are being hit the most.”
Global investors pulled a combined US$2.1 billion from Taiwanese, South Korean, Thai and Indonesian stocks in the first four days of this week, exchange data show.
More than US$19 billion was withdrawn from funds investing in developing-nation assets in the three weeks to June 12, the most since 2011, according to data from EPFR Global. The Dollar Index, which tracks the greenback against six major counterparts, rose 1.6 percent for the week, while the MSCI Asia Pacific Index of shares fell 2.5 percent.
Losses in regional currencies have forced central banks to defend their exchange rates. The Bank of Thailand will step in to curb excessive volatility in the baht if needed, Deputy Governor Pongpen Ruengvirayudh said on Thursday in Bangkok. Finance Minister Kittiratt Na-Ranong said on the same day he wanted the Bank of Thailand to “manage the foreign-exchange rate.”
Policymakers are watching the rupee and “will take steps if necessary,” Reserve Bank of India Deputy Governor H.R. Khan said on Friday.
The central bank probably sold dollars around the unprecedented 59.98 level to prevent the rupee from sliding past 60, three traders said on Thursday, asking not to be named as the information is not public.
In Taiwan, the central bank’s intervention escalated as it tried to prop up the greenback in a bid to make Taiwan-made goods cheaper in the global market, dealers said.
The greenback opened at NT$30.220 on Friday and moved to an early low of NT$29.860 before rebounding to close at NT$30.280.
Elsewhere in Asia, South Korea’s won dropped 2.4 percent this week to 1,154.15 per US dollar. Thailand’s baht fell 1.6 percent to 31.07, Indonesia’s rupiah declined 0.6 percent to 9,930, China’s yuan was down 0.06 percent at 6.1342 and the Vietnamese dong slipped 0.2 percent to 21,036.
The Fed’s signal of a policy shift also lifted the US dollar to its highest against the yen since December 2009. The greenback rose 3.8 percent to ¥97.90 this week in New York, the most since the five days ended Dec. 4, 2009. The US currency added 1.7 percent to US$1.3122 per euro, touching the strongest level since June 6. The yen lost 2.3 percent to 128.45 per euro.
The Dollar Index, which Intercontinental Exchange Inc uses to monitor the greenback against the currencies of six US trade partners, increased 2.2 percent to 82.410. It rose 1 percent on Wednesday when the Federal Open Market Committee left the monthly pace of bond purchases at US$85 billion, saying “downside risks to the outlook for the economy and the labor market” have diminished.
The gauge may climb to 85.7 by the end of the year, according to the median forecast of economists and strategists surveyed by The British pound also slumped 2.1 percent this week to US$1.5379 and depreciated 0.1 percent to £0.8531 per euro.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the