Home Forex Markets The wave of interest rate hikes by the central bank is coming, will the central bank of Taiwan follow?The Taiwan Weighted Index has fallen for two consecutive weeks, and the future trend of the US dollar against the Taiwan dollar

The wave of interest rate hikes by the central bank is coming, will the central bank of Taiwan follow?The Taiwan Weighted Index has fallen for two consecutive weeks, and the future trend of the US dollar against the Taiwan dollar

by WOOWinvest
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央行加息潮来袭,台湾央行会跟进吗?台湾加权指数连续两周下跌,美元兑台币未来走势


Abstract: The wave of interest rate hikes by the central bank is coming, will the Taiwan central bank follow up? Where is the Taiwan Weighted Index Risk?USD/Taiwan Dollar Future Trend

Since the beginning of this week, the three major central banks have raised interest rates one after another. Among them, the RBA ignored the upcoming general election and announced on the 3rd that it would raise the benchmark interest rate by 25 basis points from 0.1% to 0.35%, the first interest rate hike in 11 years. The Bank of England raised its benchmark interest rate by 25 basis points to 1.0% on the 4th, and sharply lowered economic growth in the second half of 2022 and 2023. The most eye-catching is undoubtedly the Fed’s 50 basis points increase in interest rates on the 4th to a level of 0.75% to 1%, which is in line with market expectations and is the largest rate hike by the Fed in nearly 20 years.

It should be noted that after the Fed raised interest rates by 25 basis points in March, the Central Bank of Taiwan immediately followed up with a rate hike of 1 yard. Therefore, after the Fed raised interest rates by 50 basis points in May, the market is worried about the possibility of the Central Bank of Taiwan following up on raising interest rates again.

In this regard, Xu Zhiqiang, a professor at the Department of Economics of Central University, told the Central News Agency that the central bank of Taiwan will mainly look at three factors when considering raising interest rates. Growth momentum.

On the whole, the author believes that when the major central banks enter the interest rate hike cycle, it is more likely that the Taiwan central bank will further raise interest rates, because the Taiwan central bank will keep the interest rate gap with the United States too large. However, considering that the global economic recovery is hindered, it is expected that the central bank of Taiwan may have limited room for further substantial interest rate hikes.

According to the forecast of the most hawkish French bank Natixis, Taiwan’s central bank will raise interest rates by up to 50 basis points, or 2 yards, by the end of 2022 to curb inflation and housing prices. The central bank’s rediscount rate is expected to reach 1.875% by the end of the year.

Therefore, we believe that the Taiwan Weighted Index still faces further downside risks in the market outlook. The Taiwan Weighted Index fell by more than 380 points in the day, with a backtest of 16,300 points. At the end of the day, it fell 287.92 points or 1.72% to close at 16408.2 points, falling below the short-term moving average, and the transaction value was 245.877 billion yuan. , fell for two consecutive weeks. Considering that the three major US stock indexes have weakened, the author expects that the Taiwan stock market will face the dual pressure of the overall market risk sentiment and the Taiwan central bank to raise interest rates at the same time.

On the disk, Quanwang TSMC fell by more than 2% and ended at 528 yuan. The electronic group was affected and weakened. Yageo and ASE Investment Control fell more than 2%; however, MediaTek, UMC, and Realtek all declined sharply in late trading.

Taiwan Weighted Index:

The daily chart shows that the Taiwan Weighted Index has repeatedly attacked17700After the point was unsuccessful, it turned to fall, and it is currently running in the descending channel and has fallen17000point. We believe that the Taiwan stock market has entered a downward cycle, and the risk of further growth may be in June.If the Taiwan Weighted Index procedure cannot be effectively recovered17000point, need to be alert to further fall test16000point possible.

USD/TWD future trend:

Dollar/Taiwan Dollars:

The wave of interest rate hikes by the central bank is coming, will the central bank of Taiwan follow?The Taiwan Weighted Index has fallen for two consecutive weeks, and the future trend of the US dollar against the Taiwan dollar

Dollar/Taiwan dollar is currently maintained at29.70Arranged nearby, considering that the exchange rate is in a strong upward trend, and there is no clear top signal.However, considering29.70There is strong resistance nearby, so investors need to be alert to the possibility of short-term corrections.Mid-term concern28.50Nearby kinetic energy conversion.(by Billy)

Follow me on Twitter: @BillyDF5

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