The New Taiwan dollar yesterday climbed by 0.4 percent to NT$30.695 against its US counterpart, its highest in more than five months, casting a shadow over exporters’ profitability if the rise persists, analysts said.
The local currency rose to NT$30.45 in the morning, above the central bank’s reported tolerance level of NT$30.5, but retreated toward the close of trading in Taipei due to reported interventions, a currency trader with a local bank said by telephone.
The NT dollar has strengthened 3.2 percent this year — with much of the gains concentrated over the past few days — on the back of foreign fund inflows that elevated the local bourse to 15-year highs midsession on Monday and Tuesday.
“The central bank, which has repeated its resolve to maintain currency stability, will not tolerate drastic volatility, but will step in to keep the closing price of the NT dollar below NT$30.5 in the foreseeable future,” the trader said.
Technology firms have voiced concerns over likely earnings losses caused by a stronger NT dollar.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, earlier said it arrived at its second-quarter earnings guidance based on an exchange rate of NT$31.03.
The strengthening NT dollar might weaken the gross margin of Advanced Semiconductor Engineering Inc (ASE, 日月光半導體), the world’s largest chip packager, by 0.4 or 0.5 percentage points, local media said.
“The central bank will not sit around and watch exporters suffer because they play an important role in upholding the domestic economy,” the trader said.
The nation’s GDP growth is not strong enough to allow a strong currency, the trader said.
The ongoing wave of appreciation is unlikely to last long as hot money tends to come and go quickly, the trader said, adding that the slowdown in trading volume attested to his speculation.
Turnover at foreign exchange markets yesterday totaled US$1.47 billion, lower than US$1.71 billion on Tuesday and US$1.86 billion on Monday, Taipei foreign exchange data showed.
The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) agreed, saying it is premature for firms to worry about softening profits, as the pickup in the NT dollar might prove short-lived.
“As in the past, foreign funds may soon pull out after taking profits in local shares,” CIER president Wu Chung-shu (吳中書) said in a telephone interview.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday said its materials management head, Vanessa Lee (李文如), had tendered her resignation for personal reasons. The personnel adjustment takes effect tomorrow, TSMC said in a statement. The latest development came one month after Lee reportedly took leave from the middle of last month. Cliff Hou (侯永清), senior vice president and deputy cochief operating officer, is to concurrently take on the role of head of the materials management division, which has been under his supervision, TSMC said. Lee, who joined TSMC in 2022, was appointed senior director of materials management and
Nvidia Corp CEO Jensen Huang (黃仁勳) on Thursday met with US President Donald Trump at the White House, days before a planned trip to China by the head of the world’s most valuable chipmaker, people familiar with the matter said. Details of what the two men discussed were not immediately available, and the people familiar with the meeting declined to elaborate on the agenda. Spokespeople for the White House had no immediate comment. Nvidia declined to comment. Nvidia’s CEO has been vocal about the need for US companies to access the world’s largest semiconductor market and is a frequent visitor to China.
MAJOR CONTRIBUTOR: Revenue from AI servers made up more than 50 percent of Wistron’s total server revenue in the second quarter, the company said Wistron Corp (緯創) on Tuesday reported a 135.6 percent year-on-year surge in revenue for last month, driven by strong demand for artificial intelligence (AI) servers, with the momentum expected to extend into the third quarter. Revenue last month reached NT$209.18 billion (US$7.2 billion), a record high for June, bringing second-quarter revenue to NT$551.29 billion, a 129.47 percent annual increase, the company said. Revenue in the first half of the year totaled NT$897.77 billion, up 87.36 percent from a year earlier and also a record high for the period, it said. The company remains cautiously optimistic about AI server shipments in the third quarter,
Hypermarket chain Carrefour Taiwan and upscale supermarket chain Mia C’bon on Saturday announced the suspension of their partnership with Jkopay Co (街口支付), one of Taiwan’s largest digital payment providers, amid a lawsuit involving its parent company. Carrefour and Mia C’bon said they would notify customers once Jkopay services are reinstated. The two retailers joined an array of other firms in suspending their partnerships with Jkopay. On Friday night, popular beverage chain TP Tea (茶湯會) also suspended its use of the platform, urging customers to opt for alternative payment methods. Another drinks brand, Guiji (龜記), on Friday said that it is up to individual
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