The New Taiwan dollar had its biggest weekly drop in more than a year as Europe’s sovereign debt crisis prompted investors to shun emerging-market assets and favor holding US dollars.
The currency slid for a third day as the central bank intervened in the final minutes of trading to buy the US dollar, said two traders familiar with the central bank’s operations, who declined to be identified.
Overseas funds sold US$1.8 billion more Taiwanese equities than they bought in the past five days, according to stock-exchange data.
“All banks now want to sell the Taiwan dollar and buy the US dollar because of the euro area’s collapse,” said Henry Lin, a foreign-exchange trader at Taiwan Shin Kong Commercial Bank (新光銀行) in Taipei. “Some exporters may sell the US dollar at NT$31.80.”
The Taiwan dollar fell 1.4 percent this week to NT$31.850 against its US counterpart at the 4pm close on Friday, according to Taipei Forex Inc. That was the biggest weekly drop since February last year. The benchmark TAIEX slipped for a ninth day, the longest losing streak since 2005.
Other Asian currencies also tumbled this week, with South Korea’s won and the Philippine peso posting their biggest losses in more than a year as Europe’s debt crisis drove investors from riskier assets.
The MSCI Asia-Pacific Index of regional shares had its worst week since February last year and the cost of protecting the region’s corporate bonds from default rose the most in 14 months.
The won declined 4.1 percent this week to 1,155.45 per US dollar and the peso slid 2.4 percent to 45.535. Malaysia’s ringgit dropped 2.7 percent, the most since a dollar peg ended in 2005. Indonesia’s rupiah gained 0.1 percent to 9,225 yesterday, trimming its weekly loss to 2.4 percent, on suspected intervention by the central bank.
India’s rupee also pared losses yesterday on suspected intervention, after touching a two-month low of Rs45.725 per dollar. The currency declined 2.5 percent to Rs45.4800 this week.
Elsewhere, Singapore’s dollar dropped 1.9 percent this week to S$1.3933 and the Thai baht was little changed at 32.35.
The euro fell the most against the US dollar since the collapse of global credit markets in 2008 as the European Central Bank (ECB) failed to ease concern that Greece’s fiscal crisis would intensify across the region.
The common currency on Friday surged the most in nearly four weeks on speculation the ECB may come to the aid of banks threatened by Greece’s crisis in an effort to halt contagion. The yen rose the most versus the US dollar in 11 weeks as a slide in stocks reduced demand for growth-related assets. The euro zone’s economy grew 0.1 percent in the first three months of the year, according to the median of a Bloomberg survey before a report on May 12.
The euro fell 4.1 percent this week, the most since the five days ended Oct. 24, 2008, to US$1.2755, from US$1.3294 on April 30. The common currency rose 1.1 percent on Friday, its first gain in a week. It declined 6.4 percent, also the most since October 2008, to ¥116.81, from ¥124.78.
The US dollar fell 2.4 percent to ¥91.59 this week, the biggest drop since February, from ¥93.85.
The pound touched a 13-month low of US$1.4477 against the greenback as Conservative David Cameron failed to win a majority in the House of Commons, increasing concern that the UK would be unable to tackle its fiscal deficit. For the week it declined 3.1 percent to US$1.4795, from US$1.5274.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS