The central bank is considering allowing local lenders to resume trading of non-deliverable forwards (NDF) at their offshore banking units in the near future, which may benefit local banks by adding a new source of revenue.
NDFs have become a popular instrument for companies to hedge their exposure to foreign-exchange risk for currencies that are not internationally traded.
The profit or loss at the time of the settlement date is calculated by taking the difference between the agreed-upon exchange rate and the spot rate.
The central bank unexpectedly suspended NDF trading of the New Taiwan (NT) dollar in 1998 after the Asian financial crisis on the concerns that NDFs would lead to high exchange-rate volatility and have a potential impact on local currency’s movement.
After the 16-year suspension, central bank Governor Perng Fai-nan (彭淮南) said on Wednesday that overseas branches of local banks may soon get the permission to restart trading NDFs.
Perng said the central bank would not allow local lenders to trade NDFs on the domestic market to avoid NT dollar speculation.
Local banks expect the relaxation to help them boost their service charges and profitability.
Currently, only foreign banks are allowed to do NDF business for foreign corporate clients. The market for NDF business totals hundreds of billions of NT dollars, central bank data showed.
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
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts