Taiwan dollar facing mounting depreciation pressure
A bank cashier counts Taiwan dollar banknotes. (Photo/Chao Shuang-chieh)
The Taiwan dollar finished at 29.56 against the US dollar earlier in the day in the local foreign exchange market, the lowest level since Sept. 13. 2012. It dropped by NT$0.31, which marked the largest decrease since Sept. 23, 2011.
Due to continued outflow of foreign capital from Asian markets, regional currencies, such as the Chinese yuan, South Korean won and the Singapore dollar all weakened noticeably Monday, with the won dropping the most by 1.74%. The Taiwan dollar weakened by 1.05 % and the Singapore dollar by 0.73%. The yen fell by 0.18 %, while the renminbi depreciated by 0.04%.
Market dealers said the local currency will face growing pressure to devalue if the Japanese government led by Prime Minister Shinzo Abe continues to drive down the value of the yen as part of its open- ended monetary easing policy.
Although some are concerned about the adverse impact of a weakening local currency on the domestic economy over the long term, the export-oriented hi-tech sector is enthusiastic about the trend.
No comments:
Post a Comment