Taiwan-U.S. Pledge on Currency Practices

The U.S. Treasury and Taiwan's central bank agreed to maintain consultations on macroeconomic and foreign exchange matters, pledging not to manipulate currency values for competitive edge. They acknowledged that foreign exchange market intervention could be necessary to address excessive volatility or disorderly currency movements.

The U.S. Treasury, alongside Taiwan's central bank, reaffirmed their commitment to maintaining close consultations on macroeconomic and foreign exchange rate issues. In a joint statement released recently, both parties pledged to continue their efforts in avoiding currency manipulation aimed at gaining an unfair competitive advantage.

The statement further elaborated on the conditions under which interventions in the foreign exchange markets might be deemed necessary. Such measures, they clarified, should be reserved for instances where the market experiences excessive volatility or disorderly movements in exchange rates.

The joint declaration emphasized that this tool should be seen as appropriate for addressing sharp depreciation or appreciation in currency values, ensuring that such interventions are deliberate and measured to maintain market stability.