Forex reserves hit new high at end of April after market intervention

Taipei, May 6 (CNA) Taiwan's foreign exchange reserves hit a new high at the end of April as the central bank jumped into the forex market to buy U.S. dollars, capping the appreciation of the Taiwan dollar, the bank said Tuesday.

Data compiled by the central bank showed the country had US$582.83 billion in forex reserves as of the end of April, rising by US$4.81 billion from a month earlier.

Speaking with reporters, Tsai Chiung-min (蔡炯民), head of the central bank's Foreign Exchange Department, said the increase in forex reserves came after the central bank's intervention in the forex market to curb the Taiwan dollar's appreciation against the U.S. dollar by buying the greenback to ease market volatility in the month.

After U.S. President Donald Trump announced sweeping "reciprocal" tariffs on April 2, the U.S. dollar index, which tracks the value of the greenback against the currencies of Washington's six major trading partners, fell below the critical 100 mark in the month.

Against the Taiwan dollar, the American currency shed 3.64 percent in April.

When non-U.S. dollar denominated assets in the forex reserves were converted into the greenback, the April forex reserves grew, accordingly, Tsai said.

In addition, Tsai said an increase in returns on the central bank's portfolio management operations also boosted the forex market at the end of April.

Meanwhile, central bank data showed that the value of foreign investors' holdings of Taiwan-listed stocks and bonds and Taiwan dollar-denominated deposits rose to US$721.9 billion at the end of April from US$708.9 billion at the end of March.

Those holdings represented 124 percent of Taiwan's total forex reserves at the end of April, up from 123 percent at the end of March, the data indicated.

The local central bank has said it will maintain ample forex reserves to ensure domestic financial markets remain stable and guard against any sudden movement of funds out of the country by foreign institutional investors.