Taiwan Lifers Cut FX Protection, Fueling Slump in Hedging Costs

The cost for Taiwanese investors to hedge against a weaker greenback slumped to the lowest since 2016 as local life insurers pared such wagers following an overhaul of accounting rules.

The US dollar’s 12-month non-deliverable forward points against its Taiwanese counterpart turned positive for the first time in over nine years this week, a sign that hedging costs have significantly eased. Previously, the gauge had fallen way below zero and hit the lowest level on record in June.