TWD Strengthens as Fed Rate Hike Expectations Cool, Closing at 32.231 with 5.7-Cent Gain

The New Taiwan Dollar (TWD) maintained a strong trend today, appreciating throughout the session and closing at 32.231, up 5.7 cents. The Taipei Foreign Exchange Brokers Association recorded a trading volume of USD 1.223 billion, with real demand-driven transactions as the main trading theme.

The TWD opened at 32.26, up 2.8 cents, and reached a high of 32.201 during the day. The intraday range was narrow, with only a 6.9-cent difference between high and low.

Among major Asian currencies, the Thai baht rose approximately 0.2%, the TWD closed up 0.18%, the Chinese yuan edged up 0.05%, and the Singapore dollar depreciated slightly by around 0.05%. The U.S. dollar index rebounded modestly by 0.1%, while the Japanese yen plunged 0.4% and the South Korean won fell sharply by over 0.7%.

Yuanta Investment Consulting explained that the unexpected decline in U.S. non-farm payrolls for July significantly reduced the probability of a Fed rate hike in September, boosting risk appetite. Market attention is now focused on the Fed's meeting scheduled for September 15–16. Meanwhile, Taiwan's stock market remains concentrated on quarterly earnings and monthly revenue figures, leading to high volatility in individual stocks.

Cathay Futures Research Department noted that U.S. July non-farm payrolls decreased by 23,000, far below expectations, with the previous two months revised downward by a combined 103,000. With both wage growth and labor force participation cooling, employment momentum has clearly weakened. As a result, market expectations for a September rate hike have been scaled back, leading to a decline in U.S. Treasury yields.