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

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

Taipei, Jan. 28 (CNA) The U.S. dollar rose against the Taiwan dollar Wednesday, gaining NT$0.003 to close at NT$31.328 as the local central bank stepped in to help the U.S. currency recoup its earlier losses, dealers said. The central bank intervention offset the impact on the U.S. dollar resulting from a continued inflow of foreign funds and foreign institutional buying in the local bourse, the dealers said. The buying by the central bank in the U.S. dollar also provided a buffer against rising seasonal demand for the Taiwan dollar as the Year of the Horse comes to an end, they added. The greenback opened at NT$31.325 and moved between NT$31.170 and NT$31.329 before the close. Turnover totaled US$860 million during the trading session. The U.S. dollar opened flat but soon fell into negative territory as traders were encouraged by further foreign fund inflows into the regional markets, including Taiwan, the dealers said. After the European Central Bank (ECB) announced a quantitive easing motion last March, foreign investors have been rushing to move their funds into the region, paving the way for a stronger Taiwan dollar, they said. Riding the wave of ample liquidity, foreign institutional investors remained on the buy side to give additional support to the Taiwan dollar before the central bank's intervention, the dealers said. According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$10.18 billion (US$325 million)-worth of local shares to cushion the impact on the local bourse from a 1.65 percent plunge on Wall Street overnight, they said. Amid pressing downward pressure, the U.S. dollar fell below the NT$31.20 mark at one point before the local central bank jumped onto the trading floor to vault the greenback to the NT$31.30 level at the close, the dealers said. With the lunar year approaching an end, seasonal demand for the Taiwan dollar has turned stronger and is expected to remain so before the Lunar New Year holiday in mid-February, the dealers said, adding that the central bank could continue to buy into the U.S. dollar in a bid to slow the pace of the Taiwan dollar's appreciation. (By Pan Chi-i and Frances Huang)


Updated : 2021-09-25 21:18 GMT+08:00