US dol­lar ends day higher at NT$31.755 on the Taipei forex

The China Post - - TAIWAN BUSINESS -

The U.S. dol­lar rose against the New Tai­wan dol­lar Thurs­day, gain­ing NT$0.005 to close at NT$31.755 on thin turnover as traders stayed on the side­lines ahead of the re­lease of the July U.S. job re­port later in the week, deal­ers said.

Tai­wan’s cen­tral bank jumped into the trad­ing floor in the late ses­sion, as it has done al­most ev­ery ses­sion re­cently, help­ing the U.S. dol­lar re­coup its ear­lier losses in a bid to keep Tai­wan’s ex­ports cheaper in the global mar­ket, they said.

The green­back opened at NT$31.752, and moved be­tween NT$31.626 and NT$31.760 be­fore the close. Turnover to­taled US$572 mil­lion dur­ing the trad­ing ses­sion.

The U.S. dol­lar opened higher against the New Tai­wan dol­lar but soon fell into the red as traders here took cues from a tech­ni­cal re­bound staged by the South Korean won to buy into the lo­cal cur­rency, deal­ers said.

The won’s strength re­sulted from short-cov­er­ing by traders af­ter the South Korean won fell sharply in re­cent ses­sions to be­come one of the worse per­form­ing cur­ren­cies in the re­gion, they said.

As Taipei and Seoul com­pete fiercely with each other in the global mar­ket, the New Tai­wan dol­lar tended to fol­low the fluc­tu­a­tions of the won so that the won’s gains gave a strong in­di­ca­tion to traders here to pick up the lo­cal cur­rency, they added.

Be­fore the lo­cal cen­tral bank’s in­ter­ven­tion, the New Tai­wan dol­lar was de­flated by a plunge in the lo­cal eq­uity mar­ket, deal­ers said.

Ac­cord­ing to the Tai­wan Stock Ex­change, for­eign in­sti­tu­tional in­vestors sold a net NT$2.89 bil­lion ( US$91.01 mil­lion) worth of lo­cal shares, send­ing the weighted in­dex down 1.08 per­cent at the close.

De­spite the cen­tral bank’s buy­ing of the U.S. dol­lar, trad­ing vol­ume re­mained thin as many traders pre­ferred to step back from the trad­ing floor be­fore they have more clues about the U.S. econ­omy, in­clud­ing the up­com­ing July job­less rate, deal­ers said.

Overnight, Washington re­ported the In­sti­tute for Sup­ply Man­age­ment’s ser­vices sec­tor in­dex rose to 60.3, its high­est level since Au­gust 2005, beat­ing a mar­ket es­ti­mate of 56.2, which pointed to an en­hanced pos­si­bil­ity of an in­ter­est rate hike by the U.S. Fed­eral Re­serve.

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