US dollar closes higher at NT$31.770 on Taipei forex ahead of data release
The U.S. dollar rose against the New Taiwan dollar Friday, gaining NT$0.015 to close at NT$31.770 on moderate turnover ahead of the release of July U.S. non-farm payroll data later in the day, dealers said.
Taking advantage of the limited turnover, Taiwan’s central bank continued buying into the U.S. dollar late in the session to vault the currency above its previous close by the end of the trading day, they said.
It was the seventh consecutive session in which the U.S. dollar appreciated against the New Taiwan dollar with the help of intervention by Taiwan’s central bank.
The greenback opened at NT$31.760, and moved between NT$31.635 and NT$31.775 before the close. Turnover totaled US$648 million during the trading session.
The U.S. dollar opened higher against the New Taiwan dollar on follow-through buying, but soon encountered downward pressure to fall into negative territory as traders here were encouraged by the strength of other regional currencies, in particular the South Korean won, to pick up the greenback, dealers said.
The won, which has been followed closely by traders here as a benchmark for buying and selling the New Taiwan dollar, extended its momentum from a session earlier on a technical rebound from its re- cent slump, they said.
Before the central bank intervened, foreign institutional selling on the Taiwan stock exchange let some air out of the New Taiwan dollar, dealers said.
According to the Taiwan stock exchange, foreign institutional investors sold a net NT$919 million (US$28.93 million) worth of local shares on the main board, increasing demand for the U.S. dollar.
Market sentiment in the
local foreign exchange market remained cautious, with many traders holding back as they waited for the July employment data in the United States, dealers said.
Traders wanted to have a better picture of the U.S. economy, the largest in the world, to assess whether or not the Federal Reserve will adjust its monetary policy, they said.
The Fed is expected to kick off a cycle of interest rate hikes later in the year.