US dol­lar closes lower on forex at NT$32.879 as stocks re­bound

The China Post - - TAIWAN BUSINESS -

The U. S. dol­lar fell against the New Tai­wan dol­lar Tues­day, shed­ding NT$0.081 to close at NT$32.879 as the lo­cal eq­uity mar­ket staged a strong re­bound, boost­ing de­mand for the lo­cal cur­rency, deal­ers said.

The strength of other re­gional cur­ren­cies, in par­tic­u­lar the South Korean won, gave traders here a strong hint to pick up the New Tai­wan dol­lar, while Tai­wan’s cen­tral bank jumped into the trad­ing floor to cap the gains posted by the lo­cal cur­rency, they said.

The up­turn of the New Tai­wan dol­lar, which re­bounded from a six-year low seen Mon­day, stopped a seven-ses­sion win­ning streak for the U.S. dol­lar at a time when the re­gion re­mained in a cur­rency de­pre­ci­a­tion com­pe­ti­tion.

The green­back opened at NT$32.970, and moved be­tween NT$32.620 and NT$33.000 be- fore the close. Turnover to­taled US$1.178 bil­lion dur­ing the trad­ing ses­sion.

The U.S. dol­lar opened higher against the New Tai­wan dol­lar on fol­low-through buy­ing from a ses­sion ear­lier, but soon fell to neg­a­tive ter­ri­tory as traders here wit­nessed the lo­cal eq­uity mar­ket bounc­ing back sharply on hopes that the gov­ern­ment will lend sup­port to prop up mar­ket con­fi­dence, deal­ers said.

Led by large-cap stocks in both fi­nan­cial and elec­tron­ics sec­tors, the weighted in­dex on the Tai­wan Stock Ex­change closed up 3.58 per­cent at 7,675.64 Tues­day af­ter for­eign in­sti­tu­tional in­vestors bought a net NT$3.66 bil­lion (US$111 mil­lion) worth of shares.

A ris­ing won also en­cour­aged traders here to pick up the New Tai­wan dol­lar on re­duced hopes that the U.S. Fed­eral Re­serve will kick off an in­ter­est rate hike in Septem­ber as the global econ­omy has showed signs of weak­en­ing, deal­ers said.

Amid the re­cent sell-off in the global eq­uity mar­kets, many traders have ex­pected that the Fed is in no hurry to raise in­ter­est rates for fear of im­pos­ing a fur­ther ad­verse im­pact on the world’s econ­omy, they said.

With the gov­ern­ment hav­ing cut its forecast for Tai­wan’s eco­nomic growth to 1.56 per­cent from 3.28 per­cent for 2015, cit­ing weak­erthan-ex­pected global de­mand, the lo­cal cen­tral bank re­mained on a path of in­ter­ven­tion to keep the lo­cal cur­rency cheaper for a larger share in the global mar­ket, deal­ers said.

Af­ter the U.S. dol­lar fell be­low the 32.70 mark at one point Tues­day, the cen­tral bank’s buy­ing ap­peared more vis­i­ble to push the green­back back up to a level even closer to NT$32.90 at the close, they said.

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