The central bank yesterday issued a lengthy and firm denial of allegations that it has intervened in the foreign exchange market to stem a rise in the local currency since the US removed Taiwan from its monitoring list two months ago.
The denial came after Bloomberg News on Friday last week published a story suggesting that the central bank contributed to the decline in the New Taiwan dollar toward the end of trading in recent weeks to support Taiwanese exporters.
“The report is inaccurate as the NT dollar has traded in a small range against the US dollar without evident gains or losses,” the central bank said in a six-page statement.
The US Department of the Treasury in October removed Taiwan from its currency monitoring list after accusing the local monetary policymaker of a year of interventions — as seen in a pronounced drop in value toward the end of trading.
Between September and last Friday, the price difference equals 1 or 2 basis points and volatility in the final 15 minutes is about the same as during the rest of session, the bank said.
Taiwan is home to the world’s largest contract chipmakers, chip designers and makers of electronic components used in smartphones, personal computers, connected vehicles and Internet of Things applications. A strong NT dollar might soften their competitiveness against trade rivals.
“It is the market that decides the NT dollar’s exchange rate and the central bank intervenes only when it spots abnormal activity,” the central bank said, urging the media not to produce speculative reports.
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