New Taiwan Dollar skyrockets to the 28 mark! Export industry laments, holding stablecoins with a bleeding heart..

On the 27th, the exchange rate of the new Taiwan dollar against the US dollar officially broke through the 29 yuan mark, setting a record of 28 characters for the first time in more than three years. How should we see the three major drivers of the strong appreciation of the new Taiwan dollar, the impact of Taiwan's export industry and the dilemma of government policies? (Synopsis: The Taiwan dollar has skyrocketed, and the central bank has stopped fighting? Interpretation of Yang Jinlong's mouth "self-occupants loosen loans") (Background supplement: Yang Jinlong clarifies the "truth of the explosion of the Taiwan dollar": the central bank has not been instructed by the United States, and the market is full of false information to interfere with expectations) The exchange rate of the new Taiwan dollar against the US dollar officially rose above 29 yuan this morning (27) and is now at 28.95 yuan, an appreciation of 1.7 jiao compared with the previous day's closing price of 29.165 yuan. This is the first time in more than three years that the new Taiwan dollar has returned to the 28 figure. In addition to affecting Taiwan's import and export, finance, insurance and other exchange-sensitive industries, if retail investors in the currency circle are not firm holders of the currency standard, then when they recently exchanged cryptocurrencies back to the new Taiwan dollar, there was a 13% exchange rate difference compared with the beginning of April, and their hearts were bleeding. Why does the NTD keep rising? This strong appreciation was mainly due to three factors: a weaker dollar, buoyant exports from Taiwan, and an influx of hot money. First, the dollar's performance in international markets continued to weaken, with the dollar index falling by about 4% between April and May, directly driving the new Taiwan dollar stronger. U.S. policy uncertainty and trade frictions have weighed on the dollar. Secondly, Taiwan's economic fundamentals are outstanding, especially the high demand for semiconductors and electronic components, attracting a large amount of foreign capital and local capital to return. Third, the spread of funds and the active overbuying of foreign capital have made the NTD appreciate by more than 9.5% year-to-date, making it the best performing currency in Asia. Although the central bank adopts the exchange rate policy of "blocking the rise but not the falling", the psychological barrier of 29 yuan was finally broken in the face of the concentrated foreign exchange pressure of large exporters after 10 a.m. Exporters face headwinds: industry challenges amid exchange rate shocks The strong appreciation of the new Taiwan dollar is undoubtedly a blow to Taiwanese companies that are highly dependent on exports. In particular, in the packaging and testing and electronics manufacturing industries, the estimated gross profit margin may decline by more than 1.5 percentage points, mainly because the exchange loss will be incurred immediately when the US dollar revenue is exchanged back to the New Taiwan dollar. About seventy percent of Taiwan's enterprises are export-oriented, and when the currencies of neighboring countries such as the yen appreciated by only 0.1%, the won remained flat, and the renminbi depreciated slightly, the quotations of Taiwanese products have become relatively expensive and their competitiveness has been diluted. In this regard, many people in the industry feel helpless, and some people even bluntly said: "Appreciation is more terrible than tariffs." In the face of such a situation, the industry is facing great pressure, and how to maintain product competitiveness amid exchange rate fluctuations has become a top priority for enterprises. Cryptocurrency market linkage: USDT has become cheaper USDT's quote to the new Taiwan dollar, which directly reflects the strength and weakness of the new Taiwan dollar exchange rate. At 11 a.m. on the 27th, the USDT quote of Taiwanese cryptocurrency exchange MAX fell at 29.056 yuan, a new low in nearly a month. For investors interested in buying cryptocurrencies such as Bitcoin (BTC) or Ether (ETH) in New Taiwan dollars, the appreciation of the new Taiwan dollar means that the same amount of New Taiwan dollars can now buy "discounted" USDT, which in turn reduces the cost of buying cryptocurrencies. Conversely, investors who hold cryptocurrency assets and are ready to take profits and exchange them back for NTD will face a shrinkage in the amount of refunds. The Government's Dilemma: Policy Objectives and Market Realities The central bank currently implements a managed floating exchange rate mechanism and specifically sets a sell-off period after 10 a.m. for large exporters, hoping to "trade time for space" and ease the upward pressure on the new Taiwan dollar. However, the appreciation has not slowed down, and the industry has criticized the central bank for "allowing the new Taiwan dollar to rise strongly and ignoring the survival pressure of export enterprises", believing that the Taiwan authorities have failed to effectively protect the interests of exporters. The Executive Yuan stressed that it will "continue to pay attention to exchange rate changes and respond in a timely manner", but so far, no stronger intervention tools have been proposed, and there is no hope that the Trump administration will determine the pressure to manipulate the exchange rate. Will it rise in a short time? Regarding the future market trend of the new Taiwan dollar, Li Zhenyu, chief economist of Taixin Jin, reminded that the new Taiwan dollar "still has room for appreciation" in the short term, and the limit may fall in the range of 28 to 28.5 yuan. Foreign exchange expert Li Qizhan suggested: "If the US dollar continues to weaken, the appreciation range of the new Taiwan dollar will be further amplified, and it will be a more stable strategy to enter the market in batches." In the online discussion board, the discussion of the timing of foreign exchange is also quite lively. Some people think that it is "too early" to exchange foreign exchange, and others have raised the aggressive expectation that the new Taiwan dollar may see 20 yuan by the end of the year. For families planning to go abroad during the summer vacation, it is recommended to take advantage of the strong new Taiwan dollar to exchange a part of the travel expenses, and for those who do not have urgent exchange needs, the observation time can be extended. Related reports Yang Jinlong: The "soft landing" of Taiwan's housing market has taken initial effect, but the central bank's control will not be relaxed, and it does not want to repeat the Japanese bubble: The volatility of the new Taiwan dollar "far exceeds that of Bitcoin"! Netizens go to the central bank Facebook: the export industry will collapse, Yang Jinlong is still sleeping The central bank does not rule out the "eighth wave of house fighting" Yang Jinlong: crazy buying will spawn a huge bubble, must be shot in advance "The new Taiwan dollar soared to see 28 figures! The export industry is wailing, and the heart of stable coins is bleeding: . This article was first published in BlockTempo's "Dynamic Trend - The Most Influential Blockchain News Media".

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