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U.S. dollar closes lower on Taipei forex

U.S. dollar closes lower on Taipei forex

The U.S. dollar fell against the Taiwan dollar Friday, shedding NT$0.050 to close at NT$32.965 on thin trading volume as traders took to the sidelines, waiting for retail sales data from the United States due later in the day, dealers said.

Market sentiment appeared cautious also because traders witnessed the Chinese yuan fall to a more than four-and-a-half-year low against the U.S. dollar, which has raised fears of further fund outflows from the region, they said. Taiwan's central bank entered the market again to prop up the U.S. dollar, helping the U.S. currency recoup most of its earlier losses at a time when Taiwan is suffering from falling exports amid weakening global demand, they added.

The greenback opened at NT$32.860, and moved to a low of NT$32.789 before rebounding to the day's high at the close. Turnover totaled US$432 million during the trading session.

The U.S. dollar opened lower against the Taiwan dollar as traders here locked in the gains they built for the U.S. unit in the past few sessions on the back of the local central bank's intervention, dealers said.

After the initial fall, the U.S. dollar then moved in consolidation mode as many investors retreated from the trading floor ahead of the release of U.S. retail sales data for more clues about the U.S. economic climate, they said.

Since the U.S. Federal Reserve has scheduled a policymaking meeting for next week, the market appeared jittery for the moment with mounting fears that the Fed will raise its key interest rates. The upcoming retail sales data could serve as a barometer of the U.S. economy, dealers said.

Friday's low turnover in the local foreign exchange market showed such caution toward the U.S. retail sales numbers, they said.

Since the People's Bank of China lowered the yuan's reference rate against the U.S. dollar to push down the Chinese currency to a four-and-a-half-year low, many traders here became nervous about possible volatility in the global financial markets, dealers said.

The local central bank seized the weakness of other regional currencies as a cause to buy into the U.S. dollar in the late trading session, but the bank's efforts failed to push the greenback back up to the NT$33 level at the close, dealers said. (By Chiu Po-sheng and Frances Huang)


Updated : 2021-09-18 21:47 GMT+08:00