Taiwan Reaffirms Commitment to Fair Currency Practices Amid Market Speculation

Premier Cho Jung-tai Addresses Concerns Regarding the Taiwan Dollar's Recent Appreciation.

Taipei, May 6 - Premier Cho Jung-tai (卓榮泰) addressed concerns on Tuesday regarding the recent appreciation of the Taiwan dollar, firmly stating that the government is not involved in currency manipulation. This statement comes amidst speculation linking the currency's rise to pressure from the United States.

Speaking ahead of a legislative hearing, Premier Cho emphasized the stability of Taiwan's currency, asserting that the Central Bank of the Republic of China (Taiwan) consistently adheres to legal guidelines in monitoring exchange rate fluctuations.

Responding to comments from the central bank Governor Yang Chin-long (楊金龍) regarding potential disruptive activities by speculators, Cho reiterated the government's stance against illegal market behavior, indicating that strict checks will be implemented by the central bank and financial institutions.

The Taiwan dollar experienced a significant surge on May 2nd and 5th, appreciating by NT$1.872, from NT$32.017 to the U.S. dollar at the close of trading on April 30th to NT$30.145 to the U.S. dollar on May 5th. The local currency had previously remained relatively stable, trading between NT$32.5 and NT$33 from the beginning of the year until late April.

The sharp increase, coupled with a weakening of the U.S. dollar against other major currencies, prompted some to speculate that Asian countries, including Taiwan, were adjusting exchange rates in response to potential tariff threats from U.S. President Donald Trump.

Taiwanese officials have consistently denied any connection between the Taiwan dollar's appreciation and U.S. pressure, yet the government has been cautious in its public response to potential trade coercion.

Premier Cho expressed his expectation that market mechanisms would stabilize the exchange rate, a trend that seemed to be unfolding during Tuesday's trading session. The U.S. dollar was trading around NT$30.13 at noon Tuesday, after briefly dipping below the NT$30 threshold earlier in the morning.

It's worth noting that the United States has previously designated Taiwan as a currency manipulator in 1988 and 1992. More recently, Taiwan was included on the U.S. Treasury's currency "Monitoring List" for a sixth consecutive time in its November 2024 report. This designation identifies major U.S. trading partners whose currency practices and macroeconomic policies warrant close scrutiny.