Annual growth of the nation’s money supply last month picked up in the narrow M1B gauge and retreated slightly in the broad M2 gauge, as Taiwanese investors raised their holdings in local shares and foreign bonds, the central bank said yesterday.
The M1B money supply measure, which refers to cash and cash equivalents, grew 5 percent from a year earlier, compared with a 4.94 percent increase the previous month, central bank data showed.
The securities account balance last month soared by a record NT$179.9 billion (US$5.55 billion) to a fresh peak of NT$3.56 trillion, the bank said.
Photo: CNA
The advance in M1B and the securities account balance had much to do with a bullish TAIEX and the number of transactions, central bank research official Tsao Ti-jen (曹體仁) told an online news conference.
The TAIEX ended last month at a record high of 21,107 points with margin trading, a risk appetite indicator, swelling to NT$409.5 billion, the highest since June 2008, Tsao said.
The main board has benefited from capital inflows from foreign and local investors who are aiming to take advantage of the artificial intelligence boom, he said.
Meanwhile, retail Taiwanese investors displayed more interest in the local bourse than institutional players and were responsible for 56.3 percent of overall transactions, Tsao said.
A poll conducted last week by Cathay Financial Holding Co (國泰金控) found that 47.3 percent of Taiwanese are expecting the TAIEX to rise further in the coming six months and 37 percent plan to channel their cash into stock investments.
The M2 money supply measure, which encompasses time deposits, time saving deposits, foreign currency deposits, mutual funds and M1B, grew 6.04 percent year-on-year last month, slowing from an annual increase of 6.06 percent a month earlier, the central bank said.
The retreat was due to Taiwanese trimming their time deposits and increasing their positions in foreign bonds on the expectation that the US Federal Reserve would lower interest rates later this year, Tsao said.
Interest rate cuts would boost bond prices.
VALUE: TSMC’s market capitalization far exceeds the combined size of all the Latin American companies on MSCI Inc’s benchmark for emerging markets Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) US$420 billion equity rally this year would get a valuation test this week when it reports earnings, with analysts expecting the chipmaker to raise full-year sales forecasts. The world’s biggest contract chipmaker would probably report a 29 percent increase in second-quarter net income on Thursday, according to the median estimate of analysts surveyed by Bloomberg. More importantly, analysts from JPMorgan Chase & Co to Morgan Stanley expect it to also raise its full-year sales guidance, justifying another round of valuation expansion. Just like Nvidia Corp, TSMC has become a favorite artificial intelligence (AI)-bet for investors with
ASSASSINATION ATTEMPT: The previous shooting targeting a US president or major party candidate was the 1981 incident targeting then-US president Ronald Reagan Saturday’s shooting at former US president Donald Trump’s election rally raises his odds of winning back the White House, and trades betting on his victory would increase this coming week, investors said yesterday. Trump was shot in the ear during the rally in Pennsylvania on Saturday in what the authorities were treating as an assassination attempt. Trump, his face spattered with blood, pumped his fist moments after the attack, and his campaign said he was fine after the incident. Before the shooting, markets had reacted to the prospect of a Trump presidency by pushing the US dollar higher and positioning for a
EXPECTATIONS: The firm, which is on track to outpace global foundry industry revenue growth, said it expects constrained advanced process capacity amid stronger AI demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday increased its projected revenue growth for this year to above 25 percent, as stronger-than-expected demand for premium smartphones and artificial intelligence (AI) devices are to drive greater utilization of cutting-edge 3-nanometer and 5-nanometer chips. In April TSMC estimated 21 to 24 percent annual growth. The firm’s revenue growth is on track to greatly outpace the global foundry industry, which is expected to rise about 10 percent this year. “Over the past three months, we have observed stronger AI and high-end smartphone demand from our customers, which is to boost the overall capacity utilization for our leading-edge
INVESTMENT: The company’s planned complex in Texas would be the first 12-inch silicon wafer fab built in the US in more than 20 years, a GlobalWafers official said GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said it secured up to US$400 million in direct funding from the US Department of Commerce under the CHIPS and Science Act for the construction of two new advanced fabs in the US. Its subsidiaries GlobalWafers America and MEMC LLC are to build a 12-inch silicon wafer fab in Sherman, Texas, and another one in Missouri to produce silicon-on-insulator (SOI) wafers used to make leading-edge chips. “With the support of the [US President Joe] Biden Administration, we are honored to be bringing to American shores the world’s most cutting-edge 12-inch semiconductor