News & Analysis

Taiwan Dollar becomes Asia's highest performing currency against USD

Andrew Saks, Tuesday, 20 April 2021

Today, the exotics are making headway, especially in the Asia Pacific region.

US President Joe Biden's perspective has been under the microscope in Taiwan over the past day following a US Treasury report that the government could begin to push Taiwan's Central Bank with the aim of making the Taiwan Dollar appreciate.

This shows a potential interest in trade between Taiwan and the United States, important at a time during which relations between China's mainland and the United States could potentially become strong. After all, Joe Biden is recognized by sceptics as a leader who has great experience of China's socialist economic structure.

At close of business yesterday, the Taiwan dollar rose by half a percent to 28.20 against the US dollar, making it outperform the two majors in the region - the Hong Kong Dollar and Japanese Yen - closing as the highest performing APAC region currency of the day.

Japan's Mizuho Bank's APAC division commented on this matter yesterday saying that the US Treasury's report contained an encouragement for Taiwan authorities to limit FX intervention to exceptional circumstances, and said that it is fortunate that the report did not become highlighted as a currency market manipulation tool.

Back on Western shores, British government discussions with the Bank of England demonstrate a possibility that the Bank of England may launch a form of digital currency which would be categorized as sovereign. This has created some degree of strength in British markets, hence the British Pound is now one to watch. Chancellor of the Exchequer Rishi Sunak is dubbing this the "Britcoin".... Sigh (and cue the copyright infringement-related dissent!).

As far as indices are concerned, the market rally is continuing. The rate at which the main indices are rising is now stable compared to its massively sharp increase early this week and at the end of last week, but still - it is on the up across all major executing venues globally.

The NASDAQ took a slightly bigger hit yesterday, probably because it hasn't yet breached its prior high, and the S&P 500 is still racing ahead, closing at 4191.31 last night.

The FTSE100 is down to 6962.99, which is a 0.54% drop from yesterday, however the 7000 points that it rose to during the past few days is a 12-month record high.

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