No Request from U.S. for Appreciation of Taiwan Dollar: Central Bank

Taipei: The Central Bank of the Republic of China (Taiwan) stated it has not received any request from the U.S. Department of the Treasury to push for an appreciation of the Taiwan dollar. This clarification comes amid speculation fueled by the currency's recent significant rise against the U.S. dollar. According to Focus Taiwan, the central bank issued a statement refuting local media reports suggesting that Washington had exerted pressure on Taiwan to allow its currency to strengthen. The reports referenced the "Mar-a-Lago Accord" under U.S. President Donald Trump, claiming that the United States had sought reciprocal tariffs and currency adjustments in negotiations with its trading partners. In recent movements, the Taiwan dollar appreciated by NT$1.165, or 3.64 percent, closing at NT$32.017 against the U.S. dollar-its strongest level in over five months. Following the May 1 Labor Day holiday, the currency continued its rally, rising an additional NT$0.623 to end the morning session at NT$31.394. Previo usly, on April 2, President Trump announced sweeping reciprocal tariffs targeting countries with large trade surpluses with the U.S., including a proposed 32 percent import duty on goods from Taiwan. However, a week later, Trump suspended these tariffs for 90 days to allow for negotiations. The central bank, quoting U.S. Treasury Secretary Scott Bessent, noted that Bessent had never mentioned any foreign exchange targets during discussions with his Japanese counterpart. Instead, Bessent emphasized the importance of adhering to the G7 agreement, which discourages competitive currency devaluation. Japanese officials confirmed that both Tokyo and Washington had agreed to let the yen-dollar exchange rate be determined by market forces. The bank highlighted its regular communication with the U.S. Treasury Department on foreign exchange and geoeconomic matters, facilitating effective exchange of views. It reiterated that the Taiwan dollar has remained relatively stable compared to other major currencies and pledg ed to continue monitoring global financial markets to maintain "dynamic stability" in the local currency. The central bank also noted the U.S. Treasury Department's biannual foreign exchange policy reports have not identified any major trading partners engaging in currency devaluation practices since 2021. In the most recent report, released in November 2024, Taiwan was placed on the Treasury's currency "watch list" for the sixth consecutive time. This designation is based on criteria from the Omnibus Trade and Competitiveness Act of 1988, which evaluates the foreign exchange practices of major U.S. trading partners. The U.S. Treasury Department assesses potential currency manipulation via three criteria: a bilateral trade surplus of at least US$15 billion with the United States; a material current account surplus of at least 3 percent of GDP; and evidence of persistent, one-sided foreign exchange intervention. Taiwan currently meets the first two criteria, making it likely to remain on the watch list, acco rding to the central bank.