Hot US inflation data triggered a double hit on Taiwan's stocks and currency, bad news for investors but a reminder that chip demand itself is still strong.

• The Taiwan dollar fell hard against the US dollar, and trading volume in the currency market hit an all-time daily record before the central bank stepped in to slow the drop.
• Taiwan's main stock index crashed more than 1,600 points, its sixth-biggest one-day point drop ever, as money fled chip and AI-linked shares.
• The cause is simple: US inflation came in hotter than expected, so traders gave up hope of quick rate cuts and piled into the dollar.
• TSMC still reported record quarterly profit and raised its 2026 revenue growth forecast to about 44%, saying nearly every AI player is now a customer.
• TSMC is building close to 20 new plants worldwide, adding more 3-nanometer capacity and weighing a Texas expansion — but insists it will run any fab itself.

Outlook: Expect more big swings up and down in Taiwan stocks and the local currency until the market gets a clearer read on when the Fed will cut.