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

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

Taipei, Oct. 9 (CNA) The U.S. dollar fell against the Taiwan dollar Thursday, shedding NT$0.075 to close at NT$30.430 on reduced fears that the U.S. Federal Reserve will start a rate hike cycle sooner than the market has been expecting, dealers said. Buying in the Taiwan dollar was also sparked by the strength of other regional currencies, in particular the South Korean won, as traders used the trend as a reason to increase their holdings in the local currency, the dealers said. The gains posted by the Taiwan dollar, however, were capped by local central bank intervention in a bid to slow the pace of the local unit's appreciation and maintain Taiwanese exporters' global competitiveness, they added. The greenback opened at NT$30.505, moving between NT$30.351 and NT$30.509 before the close. Turnover totaled US$700 million during the trading session. After opening flat, the U.S. dollar fell into the red in the wake of the release of the minutes of the Fed's last policymaking meeting held in mid-September, which pointed out worries over the pace of the global economic recovery, the dealers said. The Fed's concerns prompted traders at home and throughout the region to think that the U.S. central bank will keep its interest rates low for longer than the market has been expecting after winding down its current monthly bond-buying program, they said. Soon after the local foreign exchange market opened, traders rushed to buy into the Taiwan dollar and buying escalated, with other regional currencies moving higher against the U.S. dollar. The won, in particular, rose 0.91 percent against the greenback at one point, serving as a strong indication for traders here to buy the Taiwan dollar. The greenback fell below the NT$30.4 mark at one point. The local central bank jumped onto the trading floor in the late session to push up the U.S. dollar back to the NT$30.4 level at the close amid fears that a stronger Taiwan dollar will hurt the country's exports, the dealers said. (By Pan Chi-i and Frances Huang)


Updated : 2021-04-15 17:08 GMT+08:00