09:27 AM EDT, 05/07/2025 (MT Newswires) -- The Taiwan dollar (TWD) rose by 10% against the US dollar (USD) in just a few days, a very unprecedented move, noted Societe Generale.

Over the coming weeks, Taiwan's central bank (CBC) is likely to focus on stabilizing the currency, given rising domestic concerns regarding lifers and exporters, stated SocGen.

For the life insurance industry, broadly speaking, the bank thinks the risk is one of profitability rather than one of solvency. For exporters, traditional manufacturing will probably suffer even more in addition to United States tariffs and rising competition from emerging markets.

Beyond the near term, there are many moving parts to think about for the currency, pointed out SocGen.

The closer focus on trade negotiations. Currency arrangement, or as speculated, a "Mar a Lago Accord", could be very problematic in the bank's view, although the CBC could possibly be less reactive to foreign exchange depreciation going forward.

Longer term, current account and financial account flows could undergo a sea change under U.S. President Donald Trump's policies, added SocGen. Financial flows seem to be in the driving seat right now, and could be a dominant force if USD concerns remain fueled by "radical" policies in the US.