Central bank calls for calm after Taiwan dollar's steep fall

2018/10/11 21:23:56 fontsize-small fontsize-default fontsize-big
Central bank calls for calm after Taiwan dollar's steep fall

Taipei, Oct. 11 (CNA) Taiwan's central bank on Thursday called for calm over the sharp depreciation of the Taiwan dollar, saying investors should not be overly concerned by the currency's drop to a 20-month low against the U.S. dollar earlier in the day.

The U.S. dollar rose against the Taiwan dollar Thursday, gaining NT$0.137 to close at NT$31.105.

Yen Hui-huang (顏輝煌), director-general of the bank's Department of Foreign Exchange, said Taiwan will be able to weather the storm as it did during the Asian and global financial crises in 1998 and 2008, respectively, in light of the country's robust foreign exchange reserves and stable international balance of payments.

"There is no need to worry," Yen said at a press conference in Taipei.

Among the currencies of the export-focused economies in the region, the South Korean won and Taiwan dollar suffered the steepest losses Thursday against the U.S. dollar, falling 0.92 percent and 0.44 percent, respectively.

Turnover of the Taiwan dollar also exceeded US$2.5 billion during the day's trading but Yen said that was not extraordinary as Taiwan's forex market has seen a daily turnover of up to US$5 billion before.

Taiwan depends heavily on exports, which account for 60-70 percent of the country's gross domestic product (GDP), which means excessive volatility of the local currency could hurt its exports.

Yen, however, urged investors not to be overly concerned about Thursday's drop, saying the central bank is responsible for maintaining the Taiwan dollar's stability and will do everything it can to keep the rates steady.

(By Chiu Po-sheng and Ko Lin)
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