Halister News

(Bloomberg) -- USD/TWD NDFs may test resistance at 200-DMA in near term if central bank lowers benchmark interest rate tomorrow, Bloomberg strategist David Finnerty writes.

• USD/TWD NDFs now up 0.2% at 32.331; 200-DMA at 32.521
• Most economists in Bloomberg survey expect CBC to cut by 12.5 bps to 1.50%
  • Lower rates may aid domestic economy, and export sector via potentially weaker currency
• 4Q GDP declined 0.52% y/y and economic data in 1Q remains weak
  • Export orders fell y/y for 11th consecutive month in Feb.
  • Manufacturing PMI dropped back into contraction territory in Feb.
  • Industrial production declined for ninth consecutive month in Jan.; economists forecast that trend will continue when Feb. data released at 4pm today
• Bloomberg survey: 22 economists expect 12.5 bps cut tomorrow, three predict 25 bps cut and one sees no change; CBC cut rate from 1.750% to 1.625% at last meeting on Dec. 17
• USD/TWD down 0.4% at 32.410
• NOTE: David Finnerty is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.