Central Bank: Taiwanese Saving Heavily, Securities Settlement Deposit at NT$4.4237 Trillion in June, Second-Highest on Record

The Central Bank of Taiwan released domestic financial data for June today (23rd), revealing that securities settlement deposits—often regarded as a 'retail investor sentiment indicator'—decreased by NT$80.2 billion from the previous month to NT$4.4237 trillion. This ends two consecutive months of growth, yet still marks the second-highest monthly level on record, just below last month's peak. The central bank stated, 'Taiwanese people save quite a lot,' while noting, as previously indicated by Central Bank Governor Yang Chin-long, it will continue monitoring large-scale fund inflows into the stock market.

According to central bank statistics, June's securities settlement balance stood at NT$4.4237 trillion. Although slightly lower than May, it has remained above the NT$4 trillion mark for the past three months. Meanwhile, margin trading balances reached a record high of NT$803.5 billion at the end of June, surging 1.6 times compared to the same period last year, indicating a highly active stock market.

The central bank explained that securities settlement deposits are closely tied to market trading volumes, and future trends can be inferred from trading activity. Data shows that in June, individual investors accounted for 51.5% of trading volume on the Taiwan Stock Exchange, while foreign investors contributed 37%, indicating relatively balanced participation.

On the other hand, foreign residents' New Taiwan Dollar (NTD) deposit balances reached NT$285.3 billion at the end of June, the highest since February 2023. Foreign currency deposits also hit a record high of NT$9.501 trillion, driven by robust export performance. The central bank noted that 'companies typically move funds in and out, temporarily parking them.'

In June, the year-on-year growth rate of M1B money supply declined to 9.40%, primarily due to slower growth in securities settlement deposits. In contrast, the M2 growth rate rose to 8.13%, boosted by higher growth in foreign currency deposits. For the first half of the year, the average year-on-year growth rates of M1B and M2 were 7.96% and 6.46%, respectively.