US dol­lar closes at NT$31.750 on Taipei forex

The China Post - - TAIWAN BUSINESS -

The U.S. dol­lar rose against the New Tai­wan dol­lar Wed­nes­day, gain­ing NT$0.024 to close at NT$31.750 as the green­back bounced back from ear­lier losses on the back of buy­ing by Tai­wan’s cen­tral bank, deal­ers said.

The lo­cal cen­tral bank’s pres­ence off­set the im­pact on the U.S. dol­lar re­sult­ing from the weak­ness of other re­gional cur­ren­cies, which came un­der pres­sure amid con­cerns over an in­ter­est rate hike by the U.S. Fed­eral Re­serve, the deal­ers said.

It was the fifth con­sec­u­tive ses­sion in which the U.S. dol­lar had ap­pre­ci­ated against the New Tai­wan dol­lar.

The green­back opened at NT$31.760 and moved be­tween NT$31.610 and NT$31.765 be­fore the close. Turnover to­taled US$935 mil­lion dur­ing the trad­ing ses­sion.

The U.S. dol­lar opened higher against the New Tai­wan dol­lar but soon fell into the red as traders took cues from a tech­ni­cal re­bound staged by the lo­cal eq­uity mar­ket to raise their hold­ings in the New Tai­wan dol­lar, the deal­ers said.

Ac­cord­ing to the Tai­wan Stock Ex­change, for­eign in­sti­tu­tional in­vestors bought a net NT$433 mil­lion (US$13.64 mil­lion)-worth of lo­cal shares on the main board, send­ing the weighted in­dex up 0.36 per­cent at the close.

The U.S. dol­lar fell be­low the NT$31.70 mark and moved closer to NT$31.60 at one point be­fore the lo­cal cen­tral bank stepped in to prop up the cur­rency, seiz­ing selling in other re­gional cur­ren­cies, in­clud­ing the South Korean won and the Ja­panese yen, as a cause to in­ter­vene, the deal­ers said.

The losses in­curred by the won and the yen re­flected wor­ries over a rate hike by the Fed af­ter At­lanta Fed Pres­i­dent Dennis Lock­hart, a vot­ing mem­ber on the U.S. cen­tral bank’s board, told the Wall Street Jour­nal a day ear­lier that the U.S. econ­omy ap­pears ready for a rate hike in Septem­ber, they said.

Lock­hart’s re­marks sur­prised the mar­ket, as he pointed to a spe­cific time­frame for the Fed to kick off an in­ter­est rate hike cy­cle, they added.

The deal­ers said that the lo­cal cen­tral bank’s in­ter­ven­tion is ex­pected to con­tinue as the mar­ket an­tic­i­pates that the bank is aim­ing to push up the U.S. dol­lar above the NT$32 level in the short term to keep Tai­wan’s prod­ucts cheaper in the world mar­ket.

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