Taiwan’s Foreign Reserves Rebound Above $600 Billion in August

Foreign-exchange reserves are a key buffer against volatile capital flows and provide the Central Bank of the Republic of China (Taiwan) with capacity to manage disorderly currency moves. Taiwan’s reserve holdings had declined for two consecutive months before returning above the $600 billion threshold in August, reflecting a combination of portfolio income, currency valuation changes and central-bank operations in the foreign-exchange market.

The central bank said reserves stood at $601.904 billion at the end of August, up $7.633 billion from a month earlier and marking the largest monthly increase in more than a year. The gain was attributed to returns from reserve investments, movements in major currencies against the US dollar and market intervention. Foreign investors still recorded a net inflow of $1.2 billion during August despite the seasonal peak in dividend payments.