Taipei, July 9 (CNA)
The U.S. dollar rose against the Taiwan dollar Thursday, gaining NT$0.005 to close at NT$31.230 amid cautious sentiment ahead of a European Union Sunday deadline for debt-ridden Greece to find solutions to solve its debt problems, dealers said.
Since the U.S. dollar moved below its previous closing level during most of the session, Taiwan's central bank jumped onto the trading floor again to prop up the currency in a bid to keep the Taiwan dollar cheaper, the dealers said.
The greenback opened at NT$31.240 and moved between NT$30.988 and NT$31.280 before the close. Turnover totaled US$868 million during the trading session.
After opening higher against the Taiwan dollar, the U.S. dollar soon came under pressure after traders were encouraged by a move by the People's Bank of China to raise the Chinese yuan's reference rate against the greenback, the dealers said.
The buying in the Taiwan dollar also reflected expectations that the U.S. Federal Reserve will be in no hurry to launch an interest rate hike cycle after the minutes of the Fed's last policymaking meeting showed that the central bank has voiced concern over the debt crisis in Greece and financial market turmoil in China, they said. Even before the local central bank's intervention, the losses suffered by the U.S. dollar were capped to some extent by continued selling by foreign institutional investors in the local bourse Thursday, the dealers said.
According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$13.28 billion (US$425 million)-worth of local shares on the main board, sending the weighted index 0.69 percent lower at the close.
Many currency traders here continued to keep a close eye on the situation in Greece ahead of the Sunday deadline, the dealers said, adding that uncertainty over the eurozone's financial state continued to weigh on market sentiment.
Greece has applied for a third bailout package to pay its debt and keep its economy from collapsing. On Sunday, the EU is expected to discuss whether it will give Greece the money it needs, and the results will show whether Greece and its creditors will come to a consensus on the deadline. (By Frances Huang)
Taipei, July 9 (CNA)