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

2012/07/11 18:40:51

Taipei, July 11 (CNA) The U.S. dollar fell against the Taiwan dollar Wednesday, shedding NT$0.011 to close at NT$29.974 as bargain hunting emerged to help the local currency regain momentum and end a four day losing streak, dealers said.

However, turnover remained low as many traders stayed on the sidelines amid lingering concerns over the global economy, which has been hit by the debt problems in the eurozone, they said.

The greenback opened at NT$29.990, and moved between NT$29.925 and NT$30.030 before the close. Turnover totaled US$484 million during the trading session.

The Taiwan dollar extended its losses from the previous session soon after the local foreign exchange market opened, but after the local currency fell beyond the NT$30.00 level against the U.S. dollar, bargain hunters jumped in, dealers said.

Foreign banks, in particular, rushed to lock in profit off the U.S. dollar they had built in recent sessions by cutting their U.S. dollar holdings to take advantage of the low valuation of the Taiwan dollar, they said.

However, trading volume remained thin as many traders remained wary of the global economic fundamentals with sentiment hurt by the lower-than-expected imports by China for June, they added.

China reported its imports for June rose 6.3 percent from a year earlier, compared with May's growth of 12.7 percent, which indicated weakening demand from the mainland.

In addition, there have been concerns over corporate earnings in the region, where many high-tech firms have felt the pinch of the impact from the slowing global demand, dealers said.

At home, the local bourse recovered from an early low to close in positive territory, adding downward pressure on the U.S. dollar against the Taiwan dollar, in particular in the late trading session, they said.

Market sentiment remained cautious before a release of China's second quarter GDP data scheduled for Friday for a better sense of the world's economy, they added.

(By Kao Chao-fen and Frances Huang)