The main Asian currencies, including the New Taiwan dollar, will gradually appreciate against the US dollar in the second half of the year, Japan’s former top currency policy official, Eisuke Sakakibara, said yesterday.
The appreciation should help lower inflationary pressure in the Asian markets, Sakakibara said.
“The weakening of the US dollar will be a long-term trend, as the pace of recovery in the US economy could slow down in six to nine months amid rising uncertainties from its heavy national debt,” Sakakibara, dubbed “Mr Yen,” told a media briefing.
That means the currencies in Taiwan, China, South Korea, Thailand and Singapore will have a great opportunity to appreciate against the greenback in the second half of the year, but these Asian markets need not worry about the appreciation’s negative impact on exports as it would also drive down their import costs, Sakakibara said.
As for the US, Sakakibara expects its slowing economic recovery would delay any interest rate increases.
“The US will not increase its policy rates until next year, as the country could face stagflation in the second half of the year,” he said.
Rising uncertainties in the US economy could even drive the government to extend its quantitative easing measures, Sakakibara said.
The New Taiwan dollar yesterday rose to a fresh 13-and-a-half-year high against the US dollar as foreign buying of local shares boosted demand for the local currency.
The NT dollar yesterday closed up NT$0.039 at NT$28.90 against the greenback on the Taipei Forex market, and closed even higher, at NT$28.84, on the smaller Cosmos Foreign Exchange market.
It was the third time that the NT dollar has hit a 13-and-a-half-year high this month. The local currency closed at NT$28.991 on April 8, and then at NT$28.926 last Thursday, the strongest levels since the NT dollar closed at NT$28.518 on Oct. 16, 1997.
“The stock market’s strong performance helped drive up the NT dollar,” a currency trader at Union Bank of Taiwan (聯邦銀行) said by telephone.
Net buying of Taiwanese shares by foreign investors boosted demand for NT dollars, with overseas fund managers and Chinese qualified domestic institutional investors buying a total of NT$12.21 billion (US$422.7 million) on the local bourse, said a trader who declined to be named.
Foreign fund inflows also boosted trading volume on the currency market to about US$1.47 billion yesterday, the trader said.
On the Taiwan Stock Exchange, the benchmark index closed above the 9,000-point barrier for the first time since early February, with the TAIEX rising 101.11 points, or 1.13 percent, to 9,049.25 on turnover of NT$132.68 billion.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
RSS