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

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

Taipei, Oct. 7 (CNA) The U.S. dollar fell against the Taiwan dollar Tuesday, shedding NT$0.050 to close at NT$30.453, as traders took advantage of a favorable exchange rate to cash in their greenbacks for the local currency, dealers said. A technical rebound staged by other major regional currencies, in particular the Japanese yen and the South Korean won, relative to the U.S. dollar added downward pressure on the greenback in Taiwan's foreign exchange market, they said. Despite the small retreat, however, expectations of a higher U.S. dollar remained in place as traders widely anticipate that the U.S. Federal Reserve will kick off an interest rate hike cycle in mid-2015, they added. The greenback opened at the day's high of NT$30.503, and moved to a low of NT$30.410 before rebounding. Turnover totaled US$563 million during the trading session. The U.S. dollar opened flat, but soon fell into negative territory as foreign banks rushed to cut their U.S. currency holdings in exchange for the Taiwan dollar by locking in favorable rates after the U.S. unit's gains a day earlier, dealers said. The greenback gained ground on Monday as traders followed the positive lead of U.S. non-farm payroll data for September to buy into the currency on hopes that interest rates in Washington will go higher on improving economic fundamentals, they said. In September, the U.S. jobless rate fell to 5.9 percent from 6.1 percent the previous month, the lowest level since July 2008, and 248,000 jobs were created during the month, higher than market expectations of around 215,000 new jobs. Traders in the region also pocketed gains in the greenback seen a session earlier to bid up regional currencies, including the yen and the won, which gave an additional boost to the Taiwan dollar throughout the session, dealers said. The local currency's gains were limited to some extent, however, by foreign institutional selling in Taiwan's stock market, they said. Foreign institutional investors remained on the sell side on the Taiwan stock exchange Tuesday, selling a net NT$592 million (US$19.44 million) in shares. The weighted index fell 0.59 percent to 9,040.81 at the close. Dealers said that the U.S. dollar should still appreciate in value in the future as the Fed is expected to raise its key interest rates next year after winding down its monthly bond buying program, likely later this month. (By Pan Chi-i and Frances Huang)


Updated : 2021-03-05 15:30 GMT+08:00