US dollar sees slight decline to end day's trade at NT$29.446 in Taipei
CNATAIPEI -- The U.S. dollar fell against the Taiwan dollar Friday, shedding NT$0.006 to close at NT$29.446 amid an improved outlook for the regional economy, dealers said.
October 19, 2013, 12:42 am TWN
Traders showed greater willingness to hold onto regional currencies, including the Taiwan dollar, after China, the world's second largest economy, reported third quarter growth that was brisker than in the first two quarters of the year, they said.
Buying in Taiwan's equity market also added downward pressure on the U.S. dollar throughout the trading session before Taiwan's central bank stepped in to prop up the currency, they added.
The greenback opened at the day's high of NT$29.450 and moved to a low of NT$29.370 before rebounding. Turnover totaled US$566 million during the trading session.
The U.S. dollar's weakness was driven early in the session by the release of China's latest gross domestic product (GDP) report by the country's National Bureau of Statistics on Friday morning, dealers said.
According to the report, China's GDP grew 7.8 percent in the third quarter, compared with 7.7 percent and 7.5 percent growth in the first and second quarters, respectively.
The China GDP report left traders more upbeat about Asia's economic fundamentals in the region and led them to dump the U.S. dollar and buy into regional currencies, dealers said.
A move by the People's Bank of China to boost the reference rate for the Chinese yuan in exchange for the U.S. dollar also served as a strong indication to traders here to increase their Taiwan dollar holdings, they said.
The U.S. dollar also came under pressure from trading on the Taiwan stock exchange, where foreign institutional investors bought a net NT$7.93 billion (US$269 million) in local shares, lifting demand for the Taiwan dollar, dealers said.
As it has done in recent sessions, Taiwan's central bank intervened late in the session, helping the greenback recoup most of its earlier losses.
The private sector has urged the bank in recent weeks to keep the local currency relatively weak to bolster the country's exports, dealers said.