HALISTER1: INSIDE TAIWAN: TWD Stable; Trade Surplus at 6-Month High

INSIDE TAIWAN: TWD Stable; Trade Surplus at 6-Month High

(Bloomberg) -- Currency holding within recent range as exports contract less than forecast, helping to push trade surplus to $4.8b in April vs $4.5b in March.
  • Taiwan’s April exports fall 6.5% y/y, vs med. est. -8.3%; exports have fallen for 15 straight months;
  • USD/TWD little changed at 32.417, below 50-DMA at 32.654
  • Base effects won’t kick in until early 2017, because export growth slowed sharply in Aug.-to-Dec. following the yuan devaluation in August, Tim Condon, head of Asia research at ING Bank writes in a note today
    • Sees two 12.5 bps CBC policy rate cuts, one each at the June and September quarterly policy meetings; 10-yr govt bond yield forecast at 0.75% for year-end
    • USD/TWD seen in a 32.00/33.00 trading range this year
  • Overseas investors sold a net NT$7.2b ($222.56m) Taiwan stocks today
  • Yield on 0.750% govt bonds due March 2026 little changed at 0.8290%
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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Timothy Condon (ING Groep NV)

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