US dollar closes lower on Taipei forex amid better regional outlook
CNATAIPEI--The U.S. dollar fell against the New Taiwan dollar Monday, shedding NT$0.043 to close at NT$29.636 amid improving sentiment toward the regional economy in the wake of China's better-than-expected manufacturing activity, dealers said.
December 3, 2013, 12:08 am TWN
Further foreign institutional buying in the local market, which boosted demand for the Taiwan dollar, also placed downward pressure on the U.S. dollar throughout the session, they said.
The losses were largely recouped late in the day, however, by the continued efforts of Taiwan's central bank to buy into the greenback and slow down the pace of the Taiwan dollar's appreciation, they said.
The U.S. dollar opened at the day's high of NT$29.680, and moved to a low of NT$29.550 before rebounding. Turnover totaled US$505 million during the trading session.
The greenback opened higher on a mild technical rebound from a session earlier, but selling followed as traders seized on the lead of the higher-than-expected purchasing managers' index (PMI) for November released by HSBC Holdings and Markit Economics.
Although the November PMI eased to 50.8 from 50.9 recorded in October, it beat market expectations of 50.5.
Riding a wave of optimism over regional economic growth led by China, the second largest economy in the world, traders picked up the Taiwan dollar and pushed the U.S. dollar into negative territory, dealers said.
The strength of other regional currencies, including the South Korean won and the Singapore dollar, added downward pressure on the U.S. dollar in the local foreign exchange market, they said.
The U.S. dollar also faced selling on higher demand for the Taiwan dollar as foreign institutional investors were net buyers of NT$3.52 billion (US$119 million) worth of local shares, they said.
Late in the session, the local central bank intervened to prop up the U.S. dollar. Taiwanese business leaders have repeatedly urged the bank to weaken the Taiwan dollar to make locally made goods more competitive in the global market, dealers said.