Export Orders Surge, TWD Strengthens

TWD: Data on Monday showed Taiwan export orders rose 29.7% in November, the biggest jump since 2010 and some way above the 14.3% estimate

• The increase was driven by info-comm which rose 39.4% to $20.8bn, and electronics which rose 37.8% to $17.18bn. The increased demand for electronics products is attributed to demand from the US and Europe as continued Covid restrictions raise the prospect of long term work from home arrangements.
• Labour market data is due today, figures at 0800GMT/1600CST are expected to show unemployment edged lower to 3.73% from 3.77% the month before.
• USD/TWD last down 0.195 at 28.132. Rangebound trade has been the story so far, the pair has moved between 28.125 and 28.139.
• TWD is the best performing currency in Asia against the US dollar, however a similar story yesterday saw gains wiped out into the close.
• The domestic currency continues to benefit from foreign inflows into equities, latest data shows inflows were $426.1m yesterday, with total inflows of $821.7m since the start of last week.
• NDF's continue to climb, despite TWD strength today, USD/TWD 1-month NDF's last at 27.957 after touching a low of 27.813 on Dec 15. NDF's are being influenced by a pause in US dollar weakening (if not outright strength) and renewed virus concerns in the region.