* The New Taiwan dollar (NT dollar) is likely to lag behind other Asian currencies in a potential post-Fed rally. * This is due to a significant interest rate disadvantage and local firms’ preference for holding US dollars. * The NT dollar’s weakness is expected to persist despite the Fed’s easing policy.
Taiwanese companies are increasingly investing in offshore markets to diversify their portfolios and reduce their reliance on China. This trend is driven by concerns over China’s economic slowdown and geopolitical tensions. Taiwanese companies are seeking to invest in the US, Southeast Asia, and other regions to mitigate risks associated with China’s economic and political instability. **Detailed Text:**
Taiwanese companies are actively pursuing a strategy of diversification, seeking to reduce their dependence on China and mitigate risks associated with its economic and political instability.
The summary provides a key insight into the shift in foreign investment patterns, particularly in the context of the ongoing trade tensions between China and the United States. Let’s break down the key points and analyze their implications:
**1. Derisking Manufacturing Capacity:**
* **Explanation:** This refers to the process of diversifying production facilities and supply chains away from a single country, particularly one facing geopolitical or economic uncertainties. * **Context:** The US-China trade war has heightened concerns about supply chain disruptions and the potential for retaliatory tariffs. Companies are seeking to mitigate these risks by reducing their reliance on China.
