Taiwanese Dollar Plummets as Foreign Investors Withdraw Billions
Foreign investors withdrew over NT$64 billion from Taiwan's financial markets on Monday, sending the Taiwanese dollar plummeting by its largest margin in over six months. The currency closed at NT$31.848 against the US dollar, down 0.5% for the day.
The sell-off was led by foreign investors, who extended their selling streak to a fourth consecutive session and pushed cumulative withdrawals above NT$220 billion. This week's central bank rate decisions from major economies, including the US Federal Reserve, Bank of Japan, and Bank of England, have intensified market expectations for further interest rate hikes.
The strengthened US Dollar Index has also put pressure on Asian currencies, with the Taiwanese dollar being no exception. Analysts warn that if the Fed signals a hawkish stance or announces a rate hike, the US Dollar Index will receive strong support and push higher, potentially exposing the Taiwanese dollar to greater depreciation pressure.