The CBC sent out the e-mailed statement after the Taipei-based Commercial Times cited Citigroup Inc.’s Taiwan head of research Peter Kurz as saying the local dollar’s decline was a key factor in the stock market drop.

“The view that the currency’s depreciation caused the plunge in Taiwan shares wasn’t correct,” the monetary authority said. Investors sell shares first and then exchange the Taiwan dollar proceeds for foreign currency, the central bank said.

The benchmark TAIEX index fell 2.6 percent yesterday, bringing the decline this year to 25 percent, amid slowing economic growth. The Taiwan dollar dropped as much as 0.4 percent yesterday to NT$31.876 per U.S. dollar yesterday, the weakest level since Feb. 13. The currency rebounded yesterday.

“The big market event of the past month has been the sudden and rather unexpected 3.5 percent fall of the NT dollar,” Kurz wrote in a report published Sept. 2. “The NT$’s 3.5 percent fall helped boost tech sector performance while depressing overall index performance.”

The CBC didn’t name Citigroup or Kurz in its statement

Taiwan’s gross domestic product will probably expand 4.3 percent this year, the slowest since 2005 and less than the 5.72 percent in 2007, the statistics bureau said last month.

The Taiwan dollar rose as much as 0.3 percent to NT$31.731 per dollar today after the Commercial Times reported the CBC sold about US$500 million yesterday to help slow the currency’s decline.

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