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

2012/04/19 18:00:26

Taipei, April 19 (CNA) The U.S. dollar fell against the Taiwan dollar Thursday, shedding NT$0.014 to close at NT$29.532 after the local bourse reversed its earlier losses to return to the positive territory, which boosted demand for the local currency, dealers said.

However, the U.S. dollar moved on thin trading volume against the Taiwan dollar throughout the trading session amid renewed concerns over the debt problems in Europe, they said.

Volatility on Wall Street and in the European markets overnight raised concerns that the debt crisis in the eurozone will send more ripples through the global financial markets, they added.

The greenback opened at the day's high of NT$29.550 and moved to a low of NT$29.420 before rebounding. Turnover totaled US$417 million during the trading session.

Dealers said on the back of the gains posted by financial stocks, the local bourse fended off downward pressure which was triggered by the losses suffered by Wall Street and the European markets overnight amid renewed concerns over the debt situation of Spain.

Taking cues from the recovery of the local bourse, traders continued their buying in the Taiwan dollar to meet the rising demand, they said.

The weighted index closed up 0.23 percent at 7,622.69 points, off an early low of 7,528.04 after foreign institutional investors served as net buyers of NT$3.24 billion (US$110 million).

Despite the upside of the Taiwan dollar, the daily trading volume shrank since Spanish banks reported more-than-expected problem loans, prompting the market to speculate the debt ridden European country may need a bailout, dealers said.

Due to the worsening financial conditions in Spain, fears in the market have escalated that the country may encounter difficulties in its future bond auctions, which may make the country's debt problems thornier.

(By Kao Chao-fen and Frances Huang)