Taiwan Dollar Defies Global Volatility as Exporters Step In

The Taiwan dollar is exhibiting greater stability than its regional peers amid this week’s geopolitical headwinds as greenback sales from local exporters support the currency.

One-month implied volatility for the dollar-Taiwan dollar currency pair fell to the lowest since April on Friday, signaling expectations for its continued stability. Gauges for most other Asian currencies rose as President Donald Trump’s territorial claims on Greenland fueled US-Europe tensions.

US dollar sales from large exporters on Tuesday and Wednesday helped counter foreign capital outflows from the island, according to traders. Greenback selling from state-owned banks further aided the local currency, said the traders who asked not to be named as they aren’t allowed to speak publicly.

“The balanced supply and demand of USD in Taiwan’s FX market has resulted in a decline in spot volatility,” according to a BofA Securities note. “We expect this to continue throughout 1Q26.”

Taiwan’s dollar inched up 0.1% to 31.578 per greenback on Friday afternoon in Taipei. It had weakened to a eight-month low of 31.706 earlier in January amid outflows from local shares.