The price for mainstream computer memory chips may bounce back to exceed US$1 per unit as soon as the end of this quarter, helped by Lunar New Year demand in China and a supply glut, from an 85 percent plunge over the past year, a Taipei-based market researcher said yesterday.
The chip price would also get some support from falling supply from local dynamic random access memory (DRAM) chipmakers this quarter as the nation's No.3 DRAM maker ProMOS Technologies Inc (
Coupled with rising demand in the Chinese market, "It is highly likely the price for DDR2 will rebound to exceed US$1 to US$1.2 per unit," DRAMeXchange said.
The DRAM price has plunged to US$0.93 per unit on Dec. 31, compared to US$6.32 in the beginning of last year, according to the research house.
The price decline is expected to give local companies, led by Powerchip Semiconductor Corp (
Powerchip may post record high losses of NT$7.1 billion (US$220 million) for last quarter, while its smaller rivals Nanya Technology Corp (
"Their losses may narrow in the second quarter because of improvement in DRAM price. But I do not expect the companies will return to the black anytime soon as global rivals such as Samsung Electronics Co plan to expand production this year to gain market share," Liu said.
Shares of the nation's top DRAM makers -- Powerchip, Nanya and ProMOS -- jumped 1.98 percent to 3.32 percent yesterday in the wake of 3.3 percent improvement in the spot price over the past week.
Nanya Technology and Inotera Memories Inc (
"If DRAM companies cut production, or capital spending for this year before the second quarter, the price for higher-density DDR2 1GB will have a big chance of rising 35 percent further to over US$2.5 apiece, helping those companies to return to profits," DRAMeXchange said.
The report said it would be more cost-saving for local firmss to make DDR2 1GB than DDR2 512GB and that demand for high-density memory chips was on the rise.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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