US dollar rises to NT$29.452 on Taipei forex
CNATAIPEI--The U.S. dollar rose against the Taiwan dollar Thursday, gaining NT$0.027 to close at the day's high of NT$29.452 after moving in a narrow range, dealers said.
October 25, 2013, 12:27 am TWN
The smaller turnover shows that many traders stayed on the sidelines amid fears that the local central bank would make more intervention efforts to prop up the U.S. dollar in a bid to boost Taiwan's exports, the dealers said.
The central bank did step in, as it has done recently, in the latter part of the session, which helped the U.S. dollar recoup its earlier losses, they added.
The greenback opened at NT$29.425 and fluctuated between NT$29.382 and NT$29.452 before the close. Turnover totaled US$520 million during the trading session.
The U.S. dollar opened unchanged against the Taiwan dollar, but selling emerged to drag down the currency into negative territory on improved sentiment toward the regional economy, the dealers said.
Traders became upbeat about the regional economic fundamentals to raise their Taiwan dollar holdings due to the better-than-expected manufacturing activity in China for October, they said.
According to data released by HSBC Holdings and Markit Economics, China's Purchasing Managers' Index for October stood at 50.9, beating an earlier market estimate of 50.4.
Before the central bank's intervention, foreign institutional buying in the local bourse also boosted demand for the Taiwan dollar during most of the trading session, the dealers said.
Foreign institutional investors served as net buyers of NT$2.31 billion (US$78.43 million)-worth of local shares on the Taiwan Stock Exchange, while the weighted index on the main board closed up 0.23 percent at 8,413.72 points.
Due to the thinner trading volume and a narrow trading range in the local foreign exchange market, there was no need for the central bank to make too great an effort to depress the Taiwan dollar in late-session trade, the dealers said.