Exchange Rate Calculator

The exchange rate between the New Taiwan Dollar (TWD) and the Hong Kong Dollar (HKD) has exhibited modest fluctuations over the past several months. Understanding these movements requires an examination of the historical data, underlying economic factors, and the monetary policies of both regions.

Historical Exchange Rate Overview

From September 2024 to March 2025, the TWD/HKD exchange rate experienced slight variations. The highest rate during this period was 0.24606 HKD per TWD on September 29, 2024, while the lowest was 0.23518 HKD per TWD on January 12, 2025. The average exchange rate over these six months was approximately 0.23913 HKD per TWD.

In the first quarter of 2025, the exchange rate remained relatively stable. On February 13, 2025, the rate peaked at 0.2387 HKD per TWD, and on January 13, 2025, it reached its lowest point at 0.2351 HKD per TWD. The average rate during this period was 0.2369 HKD per TWD.

Economic Factors Influencing the Exchange Rate

Several economic factors have contributed to the observed exchange rate movements:

1. Trade Balances: Taiwan's robust export sector, particularly in technology and manufacturing, has bolstered the TWD. Conversely, Hong Kong's status as a financial hub with significant import activities influences the HKD. Trade surpluses in Taiwan can lead to a stronger TWD relative to the HKD.

2. Interest Rate Differentials: Differences in interest rates set by the Central Bank of the Republic of China (Taiwan) and the Hong Kong Monetary Authority affect capital flows. Higher interest rates in Taiwan attract foreign investment, increasing demand for the TWD.

3. Economic Growth: Taiwan's GDP growth, driven by its technology sector, contrasts with Hong Kong's growth, which is influenced by financial services and real estate. Disparities in economic performance can impact investor confidence and currency valuations.

Monetary Policies and Their Impact

Taiwan employs a managed float exchange rate system, allowing the TWD to fluctuate within a controlled range. The central bank intervenes to prevent excessive volatility. In contrast, Hong Kong maintains a currency board system, pegging the HKD to the US Dollar at a fixed rate. This peg ensures stability but limits the HKD's flexibility in response to market forces.

The differing monetary policies mean that external shocks, such as changes in US monetary policy or global economic downturns, can have varied effects on the TWD and HKD. For instance, a strengthening US Dollar may lead to a weaker HKD due to its peg, while the TWD might respond differently based on Taiwan's economic fundamentals.

Recent Developments and Future Outlook

As of May 3, 2025, the TWD/HKD exchange rate continues to exhibit stability, reflecting balanced economic conditions in both regions. However, potential factors that could influence future movements include:

• Global Economic Trends: Shifts in global demand for technology products could impact Taiwan's exports and, consequently, the TWD.

• US Monetary Policy: Changes in US interest rates can affect the HKD due to its peg to the US Dollar, influencing the TWD/HKD exchange rate.

• Regional Geopolitical Events: Tensions in the Asia-Pacific region may affect investor confidence, leading to capital flows that impact both currencies.

In conclusion, while the TWD/HKD exchange rate has remained relatively stable over the past several months, it is subject to various economic and geopolitical factors. Monitoring these elements is essential for anticipating future exchange rate movements.