Rising New Taiwan dollar comes with risks, rewardsCOLLISION COURSE: Strong exports prompted currency gains that could hurt trade in the long run, prompting the central bank to consider curbs on further gainsBloombergBuoyed by booming exports, the New Taiwan dollar is rallying in another attempt to crack a level that has held for almost 25 years. Taiwan’s policymakers could slow the currency’s gains as it approaches NT$27.501 per US dollar, a level it last reached in March 1997. The currency’s rise could put Taiwanese bulls on a collision course with the central bank, which frowns on excessive gains that could hurt exports. Still, others said that the central bank might tread lightly in the run-up to the release of the US Treasury Department’s foreign-exchange policy report. After the US raises borrowing costs, the Taiwan dollar is likely to return to the NT$28 level by the end of this year, said Cathay United Bank chief economist Eupho Lin.

Source: Taipei Times January 07, 2022 22:08 UTC