TWD Retests Lowest Level In 23 Years

USD/TWD hovers around neutral levels last at 28.63, after matching the lowest level for the pair in 23 years earlier in the session. TWD ended last week 0.03% stronger against the greenback, the fourth consecutive week of gains and the longest such run since July.

• The DXY has generally continued to struggle vs. G10 FX in early dealing this week, although Asia FX has struggled for a cohesive direction vs. the greenback.
• Taiwan's central bank has recently rejected pressure from exporters to reverse the appreciation of the TWD, saying the local currency's gains have been limited compared to other regional currencies.
• The central bank has said it will continue to stabilise the TWD by reducing volatility in a bid to maintain market order. Dealers have noted that the central bank has tended to intervene near the end of sessions recently by buying the U.S. dollar to cap TWD gains.