Following President Trump's announcement of reciprocal tariffs, Taiwan’s stock market experienced a significant downturn. The TAIEX closed at 19,232.35 points today after plummeting by over 2065 points—a record single-day decline surpassing the previous low set on August 5 last year and representing nearly a 10% drop. Initially depreciating against the U.S. dollar by more than NT$1 (NTD), the New Taiwan Dollar rebounded to close at NTD 33.055, gaining NT$.033.

The Central Bank's Foreign Exchange Bureau reported intervening in early trading hours to address market imbalances but refrained from further intervention after supply and demand stabilized naturally mid-afternoon. The bureau expressed confidence in Taiwan’s economic fundamentals, citing continued foreign investment despite today’s volatility.

Addressing concerns about excessive selling pressure and potential ongoing impacts on currency markets, Central Bank official Tsai Jong-min stated that while he could not comment on specific market trends, over NT$10 billion was invested by foreign investors in Taiwanese stocks today. He also noted the close correlation between Taiwan's stock performance and U.S. indices, particularly technology shares.

Tsai further explained that despite initial central bank intervention to stabilize currency rates, afternoon trading saw an influx of funds driven by confidence in economic fundamentals, leading to stabilization without additional support.

Market analysts suggest today’s mixed signals may indicate a delayed impact from foreign selling pressure on exchange markets and caution against complacency given the ongoing uncertainties surrounding tariff negotiations.

(Author: Pan Tzu-Yu; Image source: Pixabay)