US dollar falls to NT$30.002 on Taipei forex as yuan strengthens
CNATAIPEI -- The U.S. dollar fell against the New Taiwan dollar Friday, shedding NT$0.033 to close at NT$30.002 as the local market staged a rebound to put downward pressure on the greenback, dealers said.
August 17, 2013, 12:04 am TWN
A stronger Chinese yuan also prompted traders here to buy into the New Taiwan dollar throughout the session after the People's Bank of China raised the reference rate for the Chinese currency in exchange for the U.S. dollar, they said.
As with recent sessions, Taiwan's central bank once again jumped onto the trading floor in the late trading session to slow down the pace of the New Taiwan dollar's appreciation and push the U.S. dollar back to the NT$30 level, dealers said.
It was the fourth consecutive session in which the greenback closed above that level.
The U.S. dollar opened at the day's high of NT$30.006, moving to a low of NT$29.930 before rebounding. Turnover totaled US$442 million during the trading session.
The U.S. dollar lost momentum against the New Taiwan dollar soon after the local foreign exchange market opened, and selling in the greenback escalated as traders took cues from a comeback made by the local market to raise their New Taiwan dollar holdings, dealers said.
Fueled by bargain hunting, the local market reversed its early losses, even as Wall Street took a beating overnight amid concerns over a possible early exit by the U.S. Federal Reserve from its current massive bond-buying program, they said.
External factors, in particular the strength of the yuan, also served as a catalyst for the uptrend of the New Taiwan dollar as traders thought that a higher reference rate of the Chinese currency means China will allow more room for the unit to appreciate, dealers said.
Despite the local central bank's intervention, trading volume in the foreign exchange market remained thin as many traders stayed on the sidelines, waiting for housing and consumer confidence data due later in the day, they said.
The upcoming economic data is expected to provide a clearer clue to the market about what the Fed will do next about its monetary policy, they added.