US dol­lar climbs to fin­ish at day’s high of NT$31.002 on Taipei forex

The China Post - - TAIWAN BUSINESS -

The U.S. dol­lar rose against the New Tai­wan dol­lar Tues­day, gain­ing NT$0.032 to close at the day’s high of NT$31.002 on mod­er­ate trad­ing vol­ume, ahead of United States eco­nomic data that was due later in the day, deal­ers said.

Tai­wan’s cen­tral bank en­tered the trad­ing floor late in the ses­sion, help­ing the U.S. dol­lar to re­coup its ear­lier losses and fin­ish at NT$31, deal­ers said.

The green­back opened at NT$31.000, and moved to a low of NT$30.765 be­fore re­bound­ing. Turnover to­taled US$792 mil­lion dur­ing the trad­ing ses­sion.

The U.S. dol­lar opened higher against the New Tai­wan dol­lar on fol­low-through buy­ing from the pre­vi­ous ses­sion, but soon fell into neg­a­tive ter­ri­tory as traders here were mo­ti­vated by the gains on the lo­cal eq­uity mar­ket, which raised de­mand for the lo­cal cur­rency, deal­ers said. The lo­cal main board closed up 0.52 per­cent Tues­day.

The New Tai­wan dol­lar also re­bounded strongly as traders took ad­van­tage of the re­cent up­turn of the U.S. dol­lar. Af­ter the lo­cal cur­rency’s ini­tial sig­nif­i­cant gains, it moved in a nar­row range un­til the cen­tral bank’s in­ter­ven­tion, deal­ers said.

Be­fore the cen­tral bank’s in­ter­ven­tion, the weak­ness of other re­gional cur­ren­cies such as the Ja­panese yen and the South Ko- rean won de­flated the New Tai­wan dol­lar to some ex­tent. The re­gional cur­ren­cies had dropped af­ter the U.S. re­ported a bet­ter-than ex­pected in­crease of 5.1 per­cent in home sales in May to the high­est in more than five years, deal­ers said.

The fall­ing won also re­flected fears that the Bank of Korea would try to drag down the value of the cur­rency fur­ther amid a de­pre­ci­a­tion com­pe­ti­tion in the re­gion, they said.

Late in the trad­ing ses­sion, the lo­cal cen­tral bank jumped onto the trad­ing floor, help­ing to the U.S. dol­lar to re­turn to the NT$31 mark, a level the cen­tral is be­lieved to be main­tain­ing in the short term in an at­tempt to pro­tect Tai­wan’s ex­ports, deal­ers said.

De­spite the cen­tral bank’s in­ter­ven­tion, turnover re­mained mod­er­ate as many traders pre­ferred to stay on the side­lines, await­ing more eco­nomic data from the U.S. and hints of when the U.S. Fed­eral Re­serve will ad­just its mon­e­tary pol­icy, deal­ers said.

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