Impact of Tariffs on Exchange Rates: Bank of Taiwan Estimates NT Dollar Fluctuation Between 29 and 31

The U.S. has successively announced reciprocal tariff rates, with Taiwan’s rate tentatively set at 20%. The exchange rate of the New Taiwan Dollar against the U.S. Dollar once surged sharply to the "28 mark" and has currently pulled back to around 30.5. Regarding this, Ling Zhongyuan, Chairman of Taiwan Financial Holding Group and Bank of Taiwan, stated in an interview today (28th) that exchange rates are primarily determined by supply and demand. Of course, market psychology also plays a role in expectations. However, long-term observation shows that the fluctuation range of the New Taiwan Dollar is approximately between 29 and 33. Currently, it is at 30.5, which "falls within our reasonable expected range."

After U.S. President Trump announced in April that reciprocal tariffs would be imposed, the New Taiwan Dollar experienced a sharp appreciation against the U.S. Dollar, rising from the closing price of 32.017 at the end of April and once reaching the "28 mark" during trading. As the U.S. reciprocal tariffs have largely been finalized, with Taiwan’s rate tentatively set at 20%, coupled with a rebound in the U.S. Dollar, the New Taiwan Dollar has currently pulled back to 30.5.

Ling Zhongyuan, Chairman of Bank of Taiwan, attended the "Green Card Launch Press Conference" today and discussed the impact of tariffs and exchange rates on businesses in a post-event interview. She mentioned that tariffs affect both exchange rates and exports. Although exchange rates are mainly determined by market supply and demand, market expectations still play a role, and importers and exporters will make their own judgments. However, long-term observation indicates that the fluctuation range of the New Taiwan Dollar is roughly between 29 and 33, oscillating within this range.

Bank of Taiwan estimates short-term fluctuations between 29 and 31. Currently, the New Taiwan Dollar is trading at around 30 against the U.S. Dollar, and it was near 30.5 yesterday. Ling Zhongyuan stated, "This price falls within our reasonable expected range."