Taiwan Dollar Drops to Weakest Since May as Stock Outflows Surge

The Taiwan dollar extended losses to its weakest since May, weighed down by heavy foreign outflows spurred by the war in the Middle East.

Taiwan’s currency fell about 0.3% to 31.72 per dollar, the weakest since May 2. Global investors sold a net NT$94.7 billion ($3 billion) of Taiwanese stocks on Tuesday, according to exchange data, the most since September 2024.

Overseas Funds Sell Taiwan Stocks at Fastest Clip in 18 Months

The currency was also pressured by which is being boosted by demand for assets. Expectations that rising energy prices may complicate the path for more Federal Reserve interest-rate cuts is also lifting the US dollar against major currencies.

The Taiwan dollar’s retreat reverses a rally from late last week. Overseas funds had snapped up Taiwanese stocks in their in 20 years, briefly lifting the dollar to its strongest level of the year.

Now, derivatives are pricing in a bearish view on Taiwan’s dollar, with one-month non-deliverable forwards for the dollar-Taiwan dollar pair rising above 32, the highest since April on Tuesday. Trading volumes in the currency rose to the highest in data going back to 2015 in the last session.