By David Lawder and Ben Blanchard
WASHINGTON/TAIPEI (Reuters) -The U.S. Treasury and Taiwan’s central bank on Friday said they agreed to continue close consultations on macroeconomic and foreign exchange rate matters and both pledged to avoid manipulating the value of their currencies to gain a competitive advantage.
In a joint statement issued by the U.S. Treasury, they said that there were cases where intervention in foreign exchange markets could be considered.
But this “should be reserved for combating excess volatility and disorderly movements in exchange rates, with the expectation that this tool would be considered equally appropriate for addressing excessively volatile or disorderly depreciation or appreciation.”
The Treasury had kept Taiwan on its “monitoring list” for extra foreign exchange rate scrutiny as part of its latest semi-annual currency report, which found in June that no major trading partner was manipulating its currency for a trade advantage.
Taiwan’s central bank issued a separate statement in which it reiterated that the U.S. Treasury did not ask for the Taiwan dollar to appreciate.
In May, a surge in the Taiwan dollar’s value to a two-year high against the greenback had prompted speculation that this was because of a demand by Washington for an appreciation, which Taiwan’s president denied.
“During the consultations, the U.S. Treasury Department never requested an appreciation of the Taiwan dollar,” Taiwan’s central bank said in the statement on Friday. “Moving forward, the bank and the U.S. Treasury Department will continue to exchange views on macroeconomic and exchange rate policies based on our positive working relationship.”
Taiwan’s central bank said it committed that starting in 2026, it would move to quarterly disclosures of its currency interventions from its current semi-annual disclosure rate.
The bank said that the statement was unrelated to joint Taiwan-US tariff negotiations as it is not a member of a cabinet-level Taiwan-U.S. Economic and Trade Working Group.
(Reporting by David Lawder, Ben Blanchard and Doina Chiacu; Editing by Aidan Lewis and Andrea Ricci)
