Taiwan dollar surge leads to US dollar drop on forex
CNATAIPEI, Taiwan -- The U.S. dollar fell against the Taiwan dollar Thursday, shedding NT$0.078 to close at NT$29.532 after a significant comeback by the local market boosted demand for the local currency, dealers said.
October 4, 2013, 12:17 am TWN
Further inflows of foreign funds into the region led traders here to dump their U.S. dollar holdings in exchange for the Taiwan dollar, they said.
The local central bank's intervention propped up the greenback and helped the currency recoup most of its earlier losses so that it returned to the NT$29.50 mark by the end of the session, the dealers said.
The U.S. dollar opened at the day's high of NT$29.610 and moved to a low of NT$29.353 before rebounding. Turnover totaled US$849 million during the trading session.
The U.S. dollar opened steady, but selling set in to drag down its value against the Taiwan dollar as traders took hints from the high-flying local equity market, which was boosted by strong foreign institutional investors, the dealers said.
The weighted index on the Taiwan Stock Exchange closed up 1.73 percent at 8,359.02 points, with large-cap stocks in both the electronics and non-high tech sectors in focus, after foreign institutional investors served as net buyers of NT$17.01 billion (US$576 million)-worth of local shares.
After a partial shutdown of the U.S. government two days earlier that could impact the economy, many traders at home and abroad have high hopes that the U.S. Federal Reserve will put off a decision to scale down its monthly US$85 billion bond-buying program, the dealers said.
Disappointing job data released in Washington overnight further reinforced market belief that the Fed will postpone its tapering off and that the U.S. central bank will keep its fund injection program intact in the next policymaking meeting scheduled for later this month, they said.