US dollar declines NT$0.038 to close day at NT$30.012
CNATAIPEI--The U.S. dollar fell against the New Taiwan dollar Thursday, shedding NT$0.038 to close at NT$30.012 as foreign institutional investors bought into the local market to boost demand for the local currency, dealers said.
August 30, 2013, 12:00 am TWN
The strength of the South Korean won also gave traders a strong hint to cut U.S. dollar holdings in exchange for the New Taiwan dollar, they said.
The losses suffered by the U.S. dollar were capped at the end of the session after the local central bank intervened to prop up the greenback and slow down the pace of the Taiwan dollar's appreciation in a bid to bolster the country's global competitiveness, they added.
The U.S. dollar opened at the day's high of NT$30.040 and moved to a low of NT$29.931 before rebounding. Turnover totaled US$599 million during the trading session.
The U.S. dollar lost steam soon after the local foreign exchange opened as traders took cues from a technical rebound of the local market to dump the U.S. currency in favor of the Taiwan dollar as demand for the local unit grew in line with local shares, dealers said.
Foreign banks operating in Taiwan stood on the sell side of the U.S. dollar as foreign institutional investors bought a net of NT$6.92 billion (US$231 million) worth of local shares, they said.
On the back of foreign institutional buying, the benchmark weighted index on the Taiwan Stock Exchange closed up 1.19 percent at 7,917.66 points, with large cap stocks such as Taiwan Semiconductor Manufacturing Co. in focus.
Ahead of the central bank's intervention, selling in the U.S. dollar accelerated as traders witnessed the South Korean won's strong comeback, dealers said.