The currency steadied around NT$32.45 on July 31 despite a sharp rebound in Taiwan stocks, as exporter selling, dollar strength and foreign-flow uncertainty kept it in a narrow range.
The Taiwan dollar stabilized on July 31 even as Taiwan stocks mounted a sharp rebound led by technology heavyweights. The currency opened at NT$32.41, briefly strengthened to NT$32.375 on exporter month-end U.S. dollar selling and the equity rally, then reversed as the US Dollar Index rebounded above 100 and regional currencies weakened. It paused at NT$32.450 at noon, up 0.4 cents, after trading as weak as NT$32.492, with Taipei forex turnover at US$1.17 billion. The muted currency response contrasted with a surge of more than 3,000 points at one stage in the weighted stock index, driven in part by gains in electronic heavyweights such as TSMC after Microsoft's earnings beat expectations and eased concern over AI-related capital spending. Analysts said the divergence underscored how Taiwan's foreign-exchange market remains anchored more by global dollar moves and foreign investor positioning than by local equities alone. The move followed a volatile July 30 session, when the Taiwan dollar closed at NT$32.454, down 8.8 cents and at a new low in more than one year and three months, after briefly weakening past NT$32.5 to NT$32.518. Exporter dollar selling near NT$32.5 and central bank smoothing operations helped trim losses, while turnover across the Taipei and Yuanta forex markets swelled to US$3.193 billion. Broader regional currency moves also shaped trading. The Japanese yen, after a sharp jump to 157.99 amid suspected intervention, retreated back toward 160 after the Bank of Japan kept rates unchanged on July 31, while the South Korean won came under profit-taking pressure and at one point fell more than 1%. Analysts said the Taiwan dollar has recently been consolidating in a NT$32.3 to NT$32.5 range, with dividend-season remittances by foreign investors likely to remain a key near-term driver. If foreign investors turn back to net buying as AI-linked stocks stabilize, the currency could challenge NT$32.3 again, though renewed strength in the U.S. dollar may limit gains.