From BigGo Finance · BigGo Finance · · 1m 40s
Taiwan Dollar Breaks 32.5 Defense Line
Taiwan's currency drops below 32.5 defense line as foreign investors pull $18 billion out of Taiwan stocks.
In brief
Taiwan's currency drops below 32.5 defense line as foreign investors pull $18 billion out of Taiwan stocks. Taiwan's central bank reported foreign investors net sold $19.402 billion of Taiwan stocks and remitted $17.961 billion out of the country in five days, causing the Taiwan dollar to drop 1.37% in a week…
Taiwan Dollar Breaks 32.5 Defense Line
Taiwan dollar broke through the NT$32.5 per US dollar level during intraday trading on October 19, hitting a low of NT$32.550, a roughly one-and-a-half-year low, while the TAIEX plunged more than 900 points.
Central Bank Makes Rare Statement
Taiwan's Central Bank issued a rare three-point statement during trading hours, noting foreign investors sold a net $19.402 billion of Taiwan stocks and remitted a net $17.961 billion out of the country.
Weekly Depreciation
The Taiwan dollar weakened from NT$31.895 on October 12 to NT$32.338 on October 16, a single-week depreciation of 1.37%.
Foreign Capital Outflow
Foreign Investors sold a net $19.402 billion (about NT$630 billion) of Taiwan stocks and remitted a net $17.961 billion (about NT$580 billion) out of the country.
Philadelphia Semiconductor Index
The Philadelphia Semiconductor Index fell for eight consecutive trading sessions from October 7 to 16, a cumulative decline of 15.7%.
Market Reaction
After the central bank's statement, the TAIEX's decline narrowed from more than 900 points to 516 points, fluctuating around 46,594.88.
Market Analysis
Institutional analysts believe foreign investors remitted funds after collecting dividends, creating dual pressure of selling stocks and remitting funds abroad.
What Happens Next
The Taiwan dollar may continue to consolidate weakly near NT$32.5 if international technology shares remain weak, with central bank intervention key to stabilizing the exchange rate.
The headline
Taiwan's central bank reported foreign investors net sold $19.402 billion of Taiwan stocks and remitted $17.961 billion out of the country in five days, causing the Taiwan dollar to drop 1.37% in a week.
