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Taiwan dollar slips as USD demand rises, policy aims to smooth moves
FXStreet highlights USD/TWD above 32, driven more by foreign equity selling and dividend or remittance-related USD demand than by weaker domestic fundamentals.
The Taiwan dollar is staying under pressure, with USD/TWD holding above the 32 level, according to OCBC Bank’s Sim Moh Siong and Christopher Wong as covered by FXStreet.
They attribute the move largely to flow dynamics, saying foreign equity selling has weighed on Taiwan equities and boosted USD demand, while dividend and profit remittance flows add seasonal USD appetite.
OCBC noted that Taiwan authorities are encouraging faster execution of large USD sell orders to increase natural USD supply, and that exporter USD selling plus central bank guidance could help limit the risk of a disorderly increase in USD/TWD.
The note also points to market structure, with resistance cited at 32.22 and 32.50 to 32.60, and support at 31.95 and 31.76, adding that the TWD may remain vulnerable if foreign outflows continue and USD sentiment stays firm into upcoming FOMC minutes.