Central bank faces issues in curbing Taiwan dollar volatility: Experts

Detailed summary

With foreign institutional investors holding substantial Taiwan dollar-denominated assets, the central bank will face challenges in stabilizing the Taiwan dollar if foreign investors continue to move funds out of the country, market experts said.

Taipei, Nov. 7 (CNA) With foreign institutional investors holding substantial Taiwan dollar-denominated assets, the central bank will face challenges in stabilizing the Taiwan dollar if foreign investors continue to move funds out of the country, market experts said.

Speaking with CNA earlier this week, Cathay United Bank Chief Economist Lin Chi-chao (林啟超) said foreign institutional investors' share of the local market's capitalization has showed signs of increasing when the local stock exchange expanded in size.

Government's data showed their share of the local market cap rose from 43 percent at the end of 2024 to nearly 50 percent in early October.

That increase has coincided with a rise in the Taiex, the Taiwan Stock Exchange's benchmark index, from around 23,000 points in January 2025 to an all-time intraday high of 49,968.92 on Oct. 6.

Opening of the article, excerpted from Focus Taiwan (CNA). To read the rest, open the article on the publisher's site.