Full Breakdown
Taiwan Remains on U.S. Currency Manipulation Monitoring List
1/30/2026, 12:28:16 PM
Overview of the Monitoring List
The United States Department of the Treasury has retained Taiwan on its "Monitoring List" of trade partners whose currency practices warrant close scrutiny, as outlined in its semiannual report released on January 29, 2026. This report, which covers the four quarters through June 2025, identifies ten economies, including China, Japan, South Korea, Thailand, Singapore, Vietnam, Germany, Ireland, and Switzerland, that are subject to further monitoring due to their currency practices.
Key Findings on Taiwan's Currency Practices
According to the Treasury's report, Taiwan meets two of the three criteria for currency manipulation: it recorded a trade surplus with the U.S. exceeding US$100 billion (US$94.1 billion according to Taiwanese government statistics) and a current account surplus of 15 percent of GDP. However, its net foreign currency purchases totaled US$5.9 billion, representing only 0.7 percent of GDP, which did not meet the threshold for the third criterion of persistent net foreign currency purchases exceeding 2 percent of GDP.
The report highlights that Taiwan's substantial current account surplus is primarily driven by high demand for technology products, and the bilateral trade surplus with the U.S. has shown significant growth over the past five years. Despite the central bank's small net purchases of foreign currency during periods of market volatility, the New Taiwan dollar appreciated by 11.2 percent against the U.S. dollar during the reporting period.
Changes in Monitoring Criteria
The Treasury has indicated a shift in its monitoring approach, now examining whether countries' interventions to resist depreciation against the U.S. dollar are as aggressive as their efforts to resist appreciation. This broader analysis will include evaluating the influence of other government policies on foreign-exchange markets, such as capital controls and macroprudential measures.
Official Statements & Responses
The U.S. Treasury's report emphasizes the importance of transparency in currency practices. While it did not designate China as a currency manipulator, it noted concerns regarding the lack of transparency surrounding China's exchange rate policies. The report also referenced Taiwan's commitment to publicly disclose information on foreign-exchange interventions at least quarterly, as stated in a joint announcement made on November 14, 2025.
Criticism & Opposition
Critics argue that the monitoring list may disproportionately affect economies like Taiwan, which are heavily reliant on exports. They contend that the criteria for inclusion may not accurately reflect the complexities of global trade dynamics and currency valuation.
Conflicting Reports & Gaps
While the Treasury's report provides detailed insights into Taiwan's currency practices, discrepancies exist regarding the exact figures for trade and current account surpluses, with Taiwan's government statistics reporting slightly lower figures than those cited by the U.S. Treasury.
Verbatim Quotes
- “Taiwan's "extremely large current account surplus" has persisted largely because of elevated demand for technology products, the report said, describing the bilateral trade surplus with the US as having "grown considerably," continuing a five-year trend.” — U.S. Treasury Report
- “is now monitoring more broadly the extent to which economies that choose to smooth exchange rate movements do so to resist depreciation pressure in the same manner as they do to resist appreciation pressure.” — U.S. Treasury Official
- “Treasury committing to publicly disclose information on foreign exchange interventions at least quarterly.” — Joint Statement, Taiwan and U.S. Treasury
