BENGALURU: The Taiwan dollar was the sole underperformer among Asian currencies on Thursday, weighed down by equity outflows, while most regional peers held steady as investors awaited the US Federal Reserve’s annual symposium for policy cues.
The Taiwan dollar fell 0.7% to its lowest since May 5, while local stocks advanced 1.4% after declining 3% in the prior session.
Foreign investors sold T$69 billion ($2.26 billion) worth of shares on Taiwan’s stock exchange on August 20 after a tech selloff in the US, the Taiwan Stock Exchange website showed.
“Investor focus would also be on comments from the Minister of Economic Affairs at the economic committee of the Legislative Yuan of Taiwan aimed at keeping the exchange rate stable through the Lunar New Year,” said Christopher Wong, currency strategist at OCBC. “Broader US dollar direction post-Powell speech tomorrow should influence the Taiwan dollar more,” Wong added.
Other currencies in the region were largely unchanged. The dollar index slipped, as investors fretted about the Fed’s independence after US President Donald Trump called on Fed Governor Lisa Cook to resign, citing mortgage-related allegations raised by one of his political allies.
Trump has also repeatedly criticised Fed Chair Jerome Powell for moving too slowly on rate cuts, heightening investor unease about the central bank’s independence and credibility.
Investors are now focused on the Fed’s three-day annual symposium in Jackson Hole, which commences later in the day.
While the event will draw central bankers from around the world, the spotlight is on Powell’s speech on Friday for signals on the likelihood of a September interest rate cut.
