Taiwan Dollar Plunges in October, Monthly Line Falls for 2nd Straight Month
The New Taiwan dollar plunged 6.26 jiao against the U.S. dollar in October, falling from 31.852 yuan on September 30 to 32.478 yuan on October 30, a monthly depreciation of 1.96%, marking a second straight monthly decline. On the last trading day of October, the Taipei forex market remained under pressure from continued foreign capital outflows, at one point plunging more than 1.8 jiao to 32.676 yuan. With month-end exporter dollar-selling demand and central bank adjustments, it staged a late-session reversal to close slightly higher at 32.478 yuan. Although the weekly line ended 4 straight weeks of declines, rising 3 fen or 0.09%, it failed to reverse the clear weakening trend for the month.
Taiwan Stocks Crash 2728 Points as Foreign Investors Slash Holdings
Taiwan stocks underwent a sharp correction in October, closing at 45211.83 points on October 30, crashing 2728 points for the month, down more than 5.6%. The last trading day of October turned into Black Friday, plunging 1156.5 points or 2.49%, with turnover reaching 8777.7 hundred million yuan, falling below the half-year line at 45314 points. Foreign investors slashed Taiwan stocks by 1124.67 hundred million yuan in a single day, the 7th-largest net sell on record, with October net sales of nearly one trillion yuan, a record monthly high. As foreign investors slashed Taiwan stocks and repatriated funds, stocks and the currency came under pressure together, becoming the main reason for the New Taiwan dollar's decline.
AI Monetization Concerns Trigger Tech Stock Selloff
U.S. tech giants' earnings reports came in below expectations in succession, sparking market concerns about the monetization of artificial intelligence investments. Selling pressure on tech stocks intensified and spilled over to Taiwan stocks. Looking ahead, as month-end exporter dollar-selling support fades, the forex market will return to being driven by capital flows. Banks note that the New Taiwan dollar is still dominated by foreign investor flows, with Taiwan stock performance driving foreign investor moves. Whether Taiwan stocks can stabilize and rebound will be an important indicator for the New Taiwan dollar's future performance.
Steady Dollar, Central Bank Stance Seen as Key
In addition, the U.S. dollar remained steady, even as the dollar index fell below 102 to around 101.96. The U.S. Federal Reserve kept interest rates unchanged this week as expected, while signaling that upcoming inflation data will influence future policy direction, leaving investors uncertain about the rate outlook. The market currently expects a 78% chance of a rate hike in December. Banks believe that in addition to foreign investor moves and Taiwan stock performance, the central bank's stance is also key to the New Taiwan dollar's outlook. Investing involves risks, with potential gains and losses. Please read the prospectus carefully before subscribing and establish correct investment concepts to reduce risk of loss.