TAIPEI (Taiwan News) — The Taiwan dollar strengthened against the US dollar on Tuesday, reaching its strongest level in more than a month.

During intraday trading, the currency traded at around NT$31.6 per US$1. In the previous session, it had weakened in early trading, falling past the 31.8 level, according to CTEE and LTN.

The rebound came as the US dollar edged lower and global stock markets rose, alongside gains in Taiwan’s stock market. These factors encouraged foreign capital inflows into Taiwan's financial markets, boosting demand for the local currency.

Some bank analysts are speculating that concerns over conflicts in the Middle East have eased, reducing demand for the US dollar as a safe-haven asset. At the same time, foreign inflows into Taiwan equities also supported the Taiwan dollar.

Meanwhile, market participants said uncertainty remains. The Taiwan dollar is expected to stay range-bound in the near term, likely centered around the 31.7 level.

Banks also noted that geopolitical risks in the Middle East, such as potential disruptions to oil shipping routes, could push oil prices even higher. This could keep inflation pressures elevated and support demand for the US dollar.