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Quotes from Standard Chartered:
-We continue to look for a mild appreciation in the TWD in 2014. The TWD weakened in early 2014 to above 30.50 versus the US dollar (USD), due to moderating China growth and capital outflows.
-However, it has staged an impressive rally so far in Q2 and is currently one of the top performers among Asia ex-Japan (AXJ) currencies quarter-to-date. We believe the rally is a function of an uptick in domestic fundamentals, sustained equity inflows and a weaker USD environment.
-However, near-term TWD strength is likely to remain contained against continued signs of weaker China growth and rising geopolitical risks. We forecast USD-TWD trending lower in 2014, albeit modestly, to end the year at 29.60.
-Further out into 2015, we see USD-TWD rising back above 30 to close at 30.10 by Q2-2015 as the USD climbs closer to the beginning of the US rate-hike cycle.