Yuan deposits in Taiwan decline for fourth month

  • By Crystal Hsu / Staff Reporter

Chinese yuan deposits held by local banks fell 0.91 percent to 225.32 billion yuan ($34.66 billion) last month, shrinking for the fourth straight month as corporate and retail customers scaled their wealth portfolios adjusted amid inflation expectations and geopolitical tensions, the central bank said on Tuesday.

The decline is related to personal and business decisions related to asset allocation strategies and is not linked to political circumstances, the bank said.

Major Asian currencies have been hit hard this year, in part by US Federal Reserve rate hike expectations and the Japanese yen’s 10.11 percent weakening against the US dollar, sources said.

Photo: Kelson Wang, Taipei Times

The New Taiwan dollar fared better, correcting 5.27 percent, while the Chinese yuan held firm, falling 0.04 percent, becoming the best performer in the region, it said.

Yuan deposits at domestic banks fell 1.49 percent to 196.76 billion yuan after retail and corporate customers reduced their positions, the central bank said, adding that a major electronics company used yuan deposits for commodity payments.

Yuan deposits with offshore banking entities rose 3.24 percent to 28.56 billion yuan after some firms converted U.S. dollar deposits into yuan holdings to meet yuan settlement needs, the bank said.

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