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進入《TAIPEI TIMES》 NT dollar to continue flying high: central bank
Central bank Governor Yang Chin-long speaks at a meeting of the legislature’s Finance Committee in Taipei yesterday. Photo: Chien Jung-feng, Taipei Times
UNFAVORABLE FOR EXPORTERS: While non-tech firms ‘take a hard hit,’ high-tech companies remain unmarked in their international sales, the central bank governor said
By Crystal Hsu / Staff reporter
The New Taiwan dollar might trade above the NT$29 level against the greenback in the next six to 12 months, central bank Governor Yang Chin-long （楊金龍） said yesterday at a meeting of the legislature’s Finance Committee.
Asked by lawmakers whether the NT dollar’s fast appreciation would erode exporters’ profitability, Yang said that strong exports would bolster current-account surpluses and demand for the local currency.
“It might become the new normal for the NT dollar to trade above the NT$29 notch against the greenback given Taiwan’s strong exports and the weakening US currency,” Yang said, but declined to comment on potential developments beyond the six-to-twelve-month time frame, saying it would be risky and inappropriate.
The NT dollar rose 1.38 percent against the US dollar last month.
So far this month, the NT dollar has advanced another 0.57 percent, closing at NT$28.96 yesterday in Taipei trading.
A strong NT dollar is unfavorable for exporters, especially for firms with thin profit margins, Yang said, adding that the Ministry of Economic Affairs is also concerned about the issue.
However, Yang said that the market has the final say on a currency’s value and the central bank would only step in when spotting irregular activity to slow the pace of change.
Non-technology sectors are taking a hard hit from the NT dollar’s appreciation, while high-tech firms emerge unscathed, Yang said.
Gross margin at smartphone camera lens maker Largan Precision Co （大立光） stood at 65.68 percent last quarter and 53.4 percent at contract chipmaker Taiwan Semiconductor Manufacturing Co （台積電）.
Yang refused to guess whether the NT dollar would climb above his predecessor Perng Fai-nan’s （彭淮南） defense threshold, reportedly at NT$28.5.
He said that the central bank does not have a defense in mind and the floated figure is purely a fabrication.
The central bank maintains the policy of “leaning against the wind” — or working against unfavorable economic trends — in dealing with its assets and policy tools, Yang said.
Yang also dismissed media reports that the central bank plans to tighten credit controls to rein in housing price hikes.
Central bank Deputy Governor Chen Nan-kuang （陳南光） earlier this month wrote in The Taiwan Banker magazine that the central bank should put macro-prudential policies in place before expectations of property price increases take hold.
Yang said that he recently called lenders to discuss the concerns, but added that credit controls would run against the global trend of supporting the economy amid the COVID-19 pandemic.
The central bank would continue to closely monitor the property market, he said.
新聞來源：TAIPEI TIMES
