Taiwan’s Foreign Reserves Drop Most Since 2011 on Intervention

Taiwan's foreign reserves recorded their steepest monthly decline in nearly 15 years in March as the central bank sold U.S. dollars to defend the TWD against capital outflows triggered by the Iran war. The FX intervention drained reserves and signals elevated FX volatility and external financing pressure for Taiwan. Monitor for further reserve depletion and additional central bank intervention if geopolitical tensions continue.

Analysis

Taiwan's foreign reserves recorded their steepest monthly decline in nearly 15 years in March as the central bank sold U.S. dollars to defend the TWD against capital outflows triggered by the Iran war. The FX intervention drained reserves and signals elevated FX volatility and external financing pressure for Taiwan. Monitor for further reserve depletion and additional central bank intervention if geopolitical tensions continue.