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Taiwan Dollar Continues Rally; CPI In Focus


Taiwan dollar is stronger again today, on track for a fourth straight higher close. USD/TWD is down 0.044 at 27.777, the lowest since June 18.

  • The focus of the session today is CPI, the headline Y/Y figure is expected at 1.81% in July from 1.89% in June which was the highest since 2013. Goldman Sachs says: "We expect headline CPI inflation in July to pick up marginally to 2.0% year-on-year (Bloomberg consensus not available at the time of writing) from 1.9% yoy in June. This would imply +0.2% mom after seasonal adjustment (vs. 0% mom in June). High frequency data suggest that vegetable prices drifted higher while fruit prices edged down. Local gasoline prices rose around 25% yoy in July, moderating from 28% yoy in June. Core CPI inflation likely remained unchanged at 1.4% yoy (Bloomberg consensus not available at the time of writing) as the majority of households still enjoy cheaper summer prices for electricity in the month of July."
  • Elsewhere, amid China's regulatory crackdown and ensuing sell off, TSMC has replaced Tencent as Asia's biggest company by market value.

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