Diminished Fed Rate Cut Expectations Suppress Asian Currencies, with the New Taiwan Dollar weakening against the US Dollar on Tuesday, closing at 31.772 NTD to 1 USD.

By admin Mar 20, 2024

【Financial News Brief / Liu Minfu】In the Taipei foreign exchange market, the New Taiwan Dollar weakened against the US Dollar on Tuesday as market expectations for a Federal Reserve interest rate cut this year diminished further. The US Dollar Index rose for the third consecutive day in the New York forex market on Monday, putting pressure on most Asian currencies on Tuesday, including the New Taiwan Dollar, which showed weakness. Meanwhile, due to poor risk sentiment, the Taiwan stock market also performed weakly on Tuesday, with the weighted index closing down by 0.11%, providing no support for the New Taiwan Dollar exchange rate.

The New Taiwan Dollar closed at 31.772 NTD against the US Dollar on Tuesday, depreciating by 1.13 cents compared to the previous trading day. The highest and lowest transaction prices for the interbank New Taiwan Dollar to US Dollar exchange rate were 31.680 NTD and 31.799 NTD, respectively, with a trading volume of 1.328 billion USD.

The Federal Reserve began a two-day monetary policy meeting on Tuesday, with investors closely monitoring Fed Chair Powell’s speech and the Fed officials’ “dot plot” on the future interest rate path to gain insights into the Fed’s rate cut prospects for this year.

It is widely expected in the market that the Federal Reserve will keep rates unchanged this week. Reports also suggest that Goldman Sachs economists have adjusted their forecast for the Fed’s monetary policy, now expecting three rate cuts this year instead of four. Overnight interest rate swaps indicate that the probability of a rate cut in June was temporarily below 50%.

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