The New Taiwan dollar has weakened against the US dollar for two straight days — good news for exporters and holders of US dollar assets, but pressure on importers and on a central bank trying to defend the exchange rate.

• Taiwan stocks fell more than 500 points, with the index losing the 49,000 mark, as market risk appetite cooled and funds moved toward the US dollar.
• A wave of foreign remittances following TSMC's dividend payout, together with withdrawal demand ahead of the Double Ten holiday, has intensified the downward pressure.
• The US dollar index remains above the 102 level, keeping the greenback firm, and exporters selling dollars have been unable to stem the slide.
• Heavyweight stocks weakened across the board, with TSMC, MediaTek, Hon Hai and Delta Electronics all declining, while the three major shipping firms and Pegatron bucked the trend to hit limit-up.

Outlook: If Taiwan stocks fail to stabilise and US inflation data for September comes in higher than expected, the New Taiwan dollar could weaken to NT$32.2; if Taiwan stocks climb back above 50,000, the NT$32 level should still hold.