Green­back closes lower on Taipei forex at NT$32.765

The China Post - - TAIWAN BUSINESS -

The U.S. dol­lar fell against the New Tai­wan dol­lar Wed­nes­day, shed­ding NT$0.114 to close at NT$32.765 as for­eign in­vestors con­tin­ued mov­ing funds into the re­gion amid re­duced chances of an in­ter­est rate hike in the United States in Septem­ber, deal­ers said.

The strength of other re­gional cur­ren­cies, in par­tic­u­lar the South Korean won, gave a strong in­di­ca­tion to traders here to raise their New Tai­wan dol­lar hold­ings, be­fore Tai­wan’s cen­tral bank stepped in to cap the up­turn, deal­ers said.

It was the sec­ond con­sec­u­tive ses­sion that the U.S. dol­lar fell against the New Tai­wan dol­lar af­ter a seven-ses­sion hike.

The green­back opened at NT$32.885, and moved be­tween NT$32.400 and NT$32.890 be­fore the close. Turnover to­taled US$1.060 bil­lion 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 in the wake of for­eign fund in­flows into the re­gion, deal­ers said.

Amid tur­moil in the global fi­nan­cial mar­kets amid con­cerns over the main­land Chi­nese econ­omy, the sec­ond largest in the world, more and more cur­rency traders are think­ing that the U.S. Fed­eral Re­serve would be in no hurry to kick off an in­ter­est rate hike cy­cle, deal­ers said.

The mar­ket had been an­tic­i­pat­ing a U.S. in­ter­est rate in­crease in Septem­ber but that now ap­pears un­likely and some traders are pro­ject­ing that the in­crease will not take place un­til next year, deal­ers said.

Against that back­drop, for­eign in­vestors con­tin­ued to move their funds into the re­gion, help­ing to push up the re­gional cur­ren­cies, in­clud­ing the New Tai­wan dol­lar, deal­ers said.

At one point, the South Korean won, which is closely tracked by the New Tai­wan dol­lar be­cause of the global com­pe­ti­tion be­tween the two economies, rose 0.72 per­cent against the U.S. dol­lar. The won’s gains spurred selling in the green­back in Tai­wan’s for­eign ex­change mar­ket, deal­ers said.

The U.S. dol­lar fell to NT$32.40 be­fore the lo­cal cen­tral bank jumped onto the trad­ing floor to slow down the pace of the New Tai­wan dol­lar’s ap­pre­ci­a­tion, as lo­cal ex­porters have been feel­ing the pinch of weak­en­ing global de­mand, deal­ers said.

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