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U.S. dollar closes higher on Taipei forex (update)

U.S. dollar closes higher on Taipei forex (update)

Taipei, May 2 (CNA) The U.S. dollar rose against the Taiwan dollar Wednesday, gaining NT$0.008 to close at the day's high of NT$29.240 after the local central bank's intervention late in the session helped the greenback reverse its early losses, dealers said. A recent strong showing by the Taiwan dollar also prompted foreign banks to lock in profits, which compromised the local currency's gains even before the central bank stepped in, they said. The U.S. dollar opened at NT$29.230 and moved to a low of NT$29.080 before rebounding. Turnover totaled US$741 million during the trading session. The Taiwan dollar picked up steam soon after the local foreign exchange market opened, as foreign funds kept flowing into the country, dealers said. A rising South Korean won also served as a strong indication for traders in the local market to increase their holdings in the Taiwan dollar during most of the trading session, dealers said. In addition, a 2.33 percent rebound on the local bourse boosted demand for the local currency before the central bank's intervention, as traders rushed to move their funds from the safe haven of the U.S. dollar to the equity market, they said. Dealers said an improvement in manufacturing activity in the United States and China encouraged many traders to take risks in the global equity markets, including the Taiwan stock market. However, after the Taiwan dollar rose above the NT$29.100 level against the U.S. dollar, profit taking emerged through selling, largely by foreign banks, which deflated the local currency somewhat, dealers said. The central bank, which is believed to be slowing down the appreciation of the Taiwan dollar in a bid to maintain Taiwan's global competitiveness, started buying into the U.S. dollar late in the session, which helped the greenback recoup its early losses by the end of the session, dealers said. Despite the volatility of the U.S. dollar, turnover remained thin in the local foreign exchange market as many traders preferred to stay on the sidelines ahead of a run-off in the French presidential election, dealers said. (By Kao Chao-fen and Frances Huang)


Updated : 2021-05-18 23:20 GMT+08:00