《TAIPEI TIMES 焦點》 Stronger greenback will boost exports: economic council

/ Staff writer, with CNA

The National Development Council, the nation’s top economic planning agency, yesterday said that a strengthening US dollar would eventually benefit the nation’s exports.

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With the US dollar trending higher against the New Taiwan dollar, exports will rise, helping to strengthen the domestic economy, National Development Council Deputy Minister Kung Ming-hsin （龔明鑫） said.

On Wednesday, the US Federal Reserve raised its key interest rate by 0.25 percentage points, as was widely expected, citing a healthy US economy. It was only the second rate increase by the Fed in a decade and was decided by a unanimous vote.

TUMBLES

Citing the steady growth of the US economy, the Fed hinted at a quicker interest rate increase next year to prevent the economy overheating.

Based on the Fed’s decision and forecasts, the US dollar gained momentum on global markets yesterday, rising NT$0.120, or 0.38 percent, to close at NT$31.923.

In Asian trade, the US dollar pushed toward ￥118 and jumped more than 1 percent against the Australian and Canadian dollars, while the New Zealand dollar was almost 2 percent down. The Mexican peso also tumbled.

The greenback was also up 0.7 percent on the South Korean won and 0.6 percent versus the Indonesian rupiah. The Thai baht, Malaysian ringgit and Singapore dollar also suffered heavy losses.

EXPORT BOOST

The expected boost to the nation’s exports as a result of a weaker currency would result in GDP growth of 0.5 percent to 0.6 percent next year, Kung said, citing a forecast by the Directorate-General of Budget, Accounting and Statistics （DGBAS）.

Last month, the DGBAS forecast that GDP would grow 1.87 percent next year on the back of rising global demand, compared with an estimated 1.35 percent increase this year.

However, the Ministry of Economic Affairs said there is some concern that a stronger US dollar would escalate currency depreciation competition among the many export-oriented economies in Asia and therefore create greater volatility in the currency market.

Deputy Minister of Finance Su Jain-rong （蘇建榮） said the National Financial Stabilization Fund would monitor the effects of the Fed’s rate increase on the local equity market.

MARKETS

The TAIEX closed down 0.09 percent at 9,360.35 points yesterday after recovering from heavier losses early on, as the US rate increase had already been largely factored into local share prices, Su said.

Elsewhere in the region, Hong Kong shares sank 1.8 percent, with property firms hammered.

Shanghai lost 0.7 percent, Sydney was 0.8 percent lower and Singapore closed down 0.9 percent. Manila was 0.7 percent down, while Kuala Lumpur and Wellington were also sharply lower. Seoul was flat.

However, Tokyo was up 0.2 percent — heading for a ninth successive gain — as the weaker yen provided support for exporters.

Additional reporting by AFP

新聞來源：TAIPEI TIMES