Green­back falls against New Tai­wan dollar, to NT$31.113; drop stymied by cen­tral bank

The China Post - - TAIWAN BUSINESS -

The U.S. dollar fell against the Tai­wan dollar Wed­nes­day, shed­ding NT$0.060 to close at NT$31.113 as the lo­cal cur­rency fol­lowed its re­gional coun­ter­parts in mov­ing higher against the green­back, deal­ers said.

For­eign in­sti­tu­tional buy­ing in Tai­wan’s stock mar­ket also en­cour­aged for­eign ex­change traders here to cut their hold­ings in the U.S. dollar and buy the Tai­wan dollar through­out the day, they said.

Still, the losses suf­fered by the U.S. dollar were partly re­couped when Tai­wan’s cen­tral bank in­ter­vened to slow down the pace of the lo­cal cur­rency’s ap­pre­ci­a­tion and keep it from hurt­ing Tai­wan’s ex­port com­pet­i­tive­ness, deal­ers said.

The green­back opened at NT$31.180, and moved be­tween NT$31.016 and NT$31.189 be­fore the close. Turnover to­taled US$793 mil­lion dur­ing the trad­ing ses­sion.

The U.S. dollar opened higher against the Tai­wan dollar on fol­low-through buy­ing from a ses­sion ear­lier, but soon fell into neg­a­tive ter­ri­tory as other re­gional cur­ren­cies, such as the South Korean won, gained strength.

The won, which is closely tracked by the Tai­wan dollar be­cause of the in­tense com­pe­ti­tion for ex­port mar­kets be­tween Tai­wanese and South Korean com­pa­nies, got a boost from the gains posted by the Korea Stock Ex­change Kospi in­dex, which hit a four-year high.

Traders in Taipei seized on the won’s up­turn to pick up the Tai­wan dollar, a move re­in­forced by a techni- cal re­bound in Tai­wan’s mar­ket fu­eled by buy­ing in high-tech heavy­weights, deal­ers said.

Ac­cord­ing to the Tai­wan Stock Ex­change, for­eign in­sti­tu­tional in­vestors bought a net NT$6.34 bil­lion (US$204 mil­lion) in lo­cal shares on the main board to send the weighted in­dex 0.82 per­cent higher at the close.

As a re­sult, the U.S. dollar fell be­low the NT$31.10 mark at one point be­fore the cen­tral bank stepped in to prop it up, deal­ers said.

Some traders even ap­peared will­ing to give up some of the Tai­wan dollar’s gains amid fears of fur­ther in­ter­ven­tion by the cen­tral bank, which is re­port­edly work­ing with the Fi­nan­cial Su­per­vi­sory Com­mis­sion to fend off Tai­wan dollar spec­u­la­tion by for­eign in­vestors, they said.

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