Taiwan's forex reserves hit 2nd highest at end-2025, cements No. 4 status

Taipei, Jan. 6 (CNA) Taiwan's foreign exchange reserves hit US$602.55 billion at the end of December, the second highest ever, cementing the nation's status as the No. 4 forex reserves holder globally, the local central bank said Tuesday.

Data compiled by the central bank showed the country's forex reserves as of December rose US$2.76 billion from a month earlier, vaulting this month's total back over the US$600 billion mark, second only to US$602.94 billion recorded at the end of September.

Taiwan trails China (US$3.35 trillion as of November), Japan (US$1.16 trillion as of November) and Switzerland (US$903.5 billion as of November) in forex reserve holdings, according to the central bank.

Speaking with reporters, Tsai Chiung-min (蔡炯民), head of the Foreign Exchange Department, said as the U.S. dollar index fell 1.14 percent in December, other major non-greenback currencies rose, boosting the central bank's portfolio when the amount was converted into the U.S. currency.

Although the central bank jumped into the market to intervene and ease the volatility of the Taiwan dollar in December, the intervention was limited, failing to impact the month's forex reserves, Tsai said,

In May and June, the central bank jumped into the market by buying greenbacks to cap the appreciation of the local currency, giving a boost to the country's forex reserves.

In the following months, despite a stable Taiwan dollar, forex reserves continued to grow due to an increase of returns from the central bank's portfolio managements with the September figure hitting a fresh high.

In recent trading sessions, Tsai said, foreign institutional investors did not remit large funds out of or into the local market. However, contract chipmaker Taiwan Semiconductor Manufacturing Co. is slated to pay large cash dividends on Jan. 8, Tsai cautioned, saying if foreign investors move their cash dividend payouts out of Taiwan, instead of investing the money in the local stock market, the local forex market will be affected.

The central bank data showed foreign investors held US$1.15 trillion in Taiwan-listed stocks, bonds and Taiwan dollar deposits at the end of December, up from US$1.09 billion in November.

These holdings were the equivalent of 191 percent of Taiwan's total forex reserves in December, up from 182 percent in November after the local main board, where the Taiwan Stock Exchange's benchmark Taiex rose 4.84 percent.

As the central bank has announced in a joint statement with the U.S. Treasury Department to detail the amount of market intervention every quarter: in January, April, July and October, to boost market transparency, the bank disclosed on Tuesday that it bought US$1.287 billion more U.S. dollars than it sold in the third quarter of last year.

In the past, the central bank made the figure public every six months.