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US dollar ends day at NT$29.840

TAIPEI -- The U.S. dollar fell against the New Taiwan dollar Friday, shedding NT$0.07 to close at NT$29.840 after foreign institutional investors served as net buyers in the stock market, boosting demand for the local currency, dealers said.

A rebound staged by the South Korean won also encouraged traders here to cut their U.S. dollar positions in exchange for the New Taiwan dollar amid eased political tensions on the Korean Peninsula, the dealers said.

The losses suffered by the greenback were partly recouped bylocal central bank intervention that was aimed at slowing the pace of the New Taiwan dollar's appreciation, they added.

The U.S. dollar opened at the day's high of NT$29.920 and moved to an early low of NT$29.787 before rebounding. Turnover totaled US$564 million during the trading session.

The local market regained momentum soon after the market opened, with strong buying in Taiwan Semiconductor Manufacturing Co., the most weighted stock, on the back of the chip maker's upbeat sales guidance for the second quarter of this year, the dealers said.

The strong buying, in particular from foreign institutional investors, continued in the market, leading to the boosting of the New Taiwan dollar on rising fund demand, which helped the local unit pass the NT$29.80 mark at one point, they said.

Foreign institutional investors served as net buyers of NT$7.2 billion (US$241 million)-worth of local shares, while the weighted index closed up 1.78 percent at 7,930.80 points.

The strength of the won, which rebounded from an eight-month low, added downward pressure on the U.S. dollar as traders turned more optimistic about the political situation on the Korean Peninsula, the dealers said.

However, turnover remained moderate as many traders preferred to stay on the sidelines, watching the movement of the Japanese yen amid fears that further weakness will worsen a currency depreciation competition in the Asian region, the dealers said.

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