New Taiwan Dollar Ends 5-Day Depreciation Streak, Surges 1.11 Jiao to Close at 32.032

(CNA, reporter Pan Zih-yu, Taipei, July 8) Investors are awaiting the release of the US Federal Reserve's meeting minutes, creating a strong wait-and-see atmosphere. However, some foreign capital inflows in the morning, coupled with export businesses selling foreign currency, drove the New Taiwan Dollar exchange rate to surge by nearly 2 jiao, returning to the 31-dollar level. It closed at 32.032 yuan, a surge of 1.11 jiao, ending a 5-day depreciation streak. The total transaction volume in the Taipei and Tankan foreign exchange markets narrowed to US$2.101 billion.

The US Federal Reserve (Fed) is about to release the minutes of its June meeting, and the market is holding its breath, hoping to find more clues about the interest rate path. The financial markets are dominated by a wait-and-see atmosphere, and concerns over the uncertain prospects of the artificial intelligence (AI) industry have led investors to worry. US stocks closed in the red.

The Taiwan stock market fluctuated today, briefly turning negative, but closed up 255.3 points at 45734.41 points. Foreign investors continued their selling streak for the fifth consecutive day, offloading another NT$37.949 billion today, bringing their cumulative withdrawals from the Taiwan stock market to over NT$280 billion.

After opening at 32.15 against the US dollar today, the New Taiwan Dollar continued its depreciation, quickly hitting a daily low of 32.185. It then staged a dramatic turnaround, with the exchange rate rebounding strongly, reaching a high of 31.963 during the day, a surge of 1.8 jiao. However, the gains narrowed in the afternoon, closing at 32.032 yuan.

Foreign exchange traders pointed out that foreign investors were still the main drivers of the market today. Some foreign capital inflows were seen in the morning, and export businesses also entered the market, leading to a strong rebound in the exchange rate. As the New Taiwan Dollar had depreciated significantly in the previous few days, import businesses, seeing the US dollar price steadily rise, quickly bought dollars when the exchange rate returned to the 31-dollar level, causing the appreciation to narrow. The exchange rate then returned to fluctuating consolidation in the afternoon.

Foreign exchange traders stated that today's market transaction volume narrowed to just over US$2 billion, making it easier for large one-way capital flows to dominate the market. However, July and August are peak seasons for dividend payouts. Although export businesses are holding the line on the upper end and the exchange rate has support, it is expected to be difficult to resist the outflow of foreign capital. In the short term, the New Taiwan Dollar is still expected to show a trend of gradual depreciation. (Editor: Lin Shu-yuan) 1150708

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