TAIPEI (Taiwan News) — The Central Bank said on Monday it may intervene in foreign exchange markets to stabilize the New Taiwan dollar amid ongoing financial volatility triggered by US tariffs.
The bank said in a press release that four stabilization measures are ready to be implemented if required, per CNA. They include monitoring large foreign exchange settlements, ensuring foreign currency liquidity domestically and internationally, and market intervention if significant exchange rate fluctuations occur.
Speaking at a press conference, the bank’s Foreign Exchange Department Director Tsai Chiung-min (蔡炯民) said the foreign exchange situation on Monday was relatively stable. “Everyone should have confidence,” he added.
The bank’s release said the New Taiwan dollar appreciated by 1.59% against the US dollar after the imposed tariffs. The Japanese yen, euro, and Canadian dollar also appreciated, while the Australian dollar, British pound, offshore Renminbi, and Korean won depreciated against the US dollar, it said.
Tsai said the bank used flexible monetary policies to guide Taiwan through market turmoil before. He said this includes the Asian financial crisis, the European debt crisis, COVID-19, and other major global events.
The Central Bank release also showed Taiwan had US$578.022 billion (NT$19.125 trillion) in foreign exchange reserves at the end of March. “Taiwan has run a foreign trade surplus for a long time, its balance of payments is sound, and its external debt is extremely low,” the bank said.
The bank’s announcement came after the Taiwan stock market suffered significant losses earlier in the day. Asked about this, Tsai said he is not a stock market expert, and added that the effect on foreign exchange markets will only be seen after a few days, per Up Media.
Tsai noted that the US and Taiwan stock markets are closely linked, with movements in US technology stocks often indicating where the Taiwan market might be headed. He emphasized that this is one of many factors influencing the Taiwan market.
