Taiwan's central bank said on Sunday that US government debt is "sound" and still attracts investor interest, and that there are no concerns about the US dollar's status as the leading international reserve currency.
The dollar's global standing has been called into question after US President Donald Trump's announcement of tariffs on April 2, which led to a sharp decline in markets, including US Treasury bonds, cast doubt on the dollar's safe-haven status.
Trump's complaints about the dollar's strength have fueled speculation that Washington wants to devalue the US currency.
According to the central bank, Taiwan's $582.8 billion foreign exchange reserves are more than 80% comprised of US Treasuries.
Responding to what it described as market concerns about US bonds and the dollar, the central bank stated on its website that there was no cause for concern.
He added, "There are currently no concerns about the US dollar's status as the leading international reserve currency. US public debt is stable and well-liquidated, and investors continue to prefer it as a store of value."
The central bank also urged the media and market commentators not to speculate on foreign exchange rates, given the Taiwanese dollar's appreciation against the US currency since last month amid speculation that Washington had asked Taipei to allow it to strengthen as part of tariff negotiations.
In its statement issued on Sunday, the central bank stated that its inspection teams had discovered that some unnamed foreign investors had transferred large sums into Taiwanese dollar deposit accounts under the pretext of investing in Taiwanese stocks.
However, no such investments have taken place, according to the bank, adding that foreign investors should use the transferred funds to invest in local securities if that is the stated purpose of their investment, "not to use them to speculate on the Taiwanese dollar exchange rate."
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