TAIPEI (Taiwan News) — The Economist’s latest Big Mac Index shows the Taiwan dollar is nearly 60% undervalued against the US dollar, CTEE reported Wednesday.

The index shows the burger costs US$6.12 in the US, compared with NT$78 (about US$2.50) in Taiwan. Based on those prices, the implied exchange rate would be roughly NT$12.75 per US dollar, stronger than the current market rate of about NT$31.57.

Introduced in 1986, the index is a simplified measure of purchasing power parity that compares McDonald’s signature burger prices worldwide to assess whether currencies are overvalued or undervalued against the US dollar. The Economist stresses that it is not a precise valuation tool but an accessible way to illustrate exchange-rate distortions.

Across much of Asia, currencies appear undervalued, with Taiwan standing out. In Japan, the yen is undervalued by about 50.5%, while in South Korea, the won is undervalued by roughly 38.9%, based on Big Mac prices compared with current market exchange rates.

In previous commentary, the publication has warned of the Taiwan dollar’s long-term undervaluation, arguing that outdated policies have contributed to rising housing prices while leaving the economy heavily reliant on imported food and energy, limiting how much ordinary citizens benefit from growth.

Taiwan’s Central Bank has pushed back against the findings. It said exchange rates are determined by foreign exchange market supply and demand and cannot be judged by the price of a single product.

The bank also cited Nomura Holdings’ 2016 iPhone index, which compared handset prices across 23 currencies. It found the US dollar to be the most undervalued at the time, in contrast to the Big Mac Index.