Halister News

(Bloomberg) -- USD/TWD 1-mo. NDFs may test support at 30.967-31.045 area, which consists of series of lows starting Aug. 16, in short-term if Taiwan’s central bank leaves interest rates unchanged, Bloomberg strategist David Finnerty writes.

• NDFs are being weighed down by Fed lowering its dot path for 2017 onwards, which is spurring risk-on sentiment
• Resistance at 50-DMA bearishly held earlier this week and MACD remains bearishly below zero and signal line
• International investors have also been net buyers of $7.8b in island’s equities so far this quarter: exchange data
• CBC will maintain its benchmark rate unchanged at 1.375%, according to 14 of 26 economists in Bloomberg survey; 12 predict a cut of 0.125 bps to 1.250%; decision due tomorrow
• Central bank lowered its benchmark rate by 0.125 bps at its June 30 meeting to aid growth, given Brexit and projected slack in global economy had compounded risks to international trade and the economic outlook
• Since June 30 meeting, economic data have been mixed; CPI fell to 0.57% y/y in Aug., lowest reading since Dec. 2015, while industrial production grew 7.74% y/y in Aug., most since Dec. 2014
• 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.