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

2012/07/20 19:52:01

Taipei, July 20 (CNA) The U.S. dollar rose against the Taiwan dollar Friday, gaining NT$0.011 to close at NT$29.995, but turnover remained low as concerns over the global economy kept many traders off the trading floor, dealers said.

The Taiwan dollar faced late session selling in particular, reversing its early gains, as the local central bank continuedwith efforts to slow the pace of the unit's appreciation againstthe greenback to protect Taiwanese exports, the dealers said.

The U.S. dollar opened at NT$29.990, and moved between NT$29.850 and NT$30.000 before the close. Turnover totaled US$491 million during the trading session.

Traders were afraid that Taiwanese exporters will pay a price for the slowing global demand, as exports serve as the driver of the nation's economic growth, they said.

Many traders were waiting for the July 23 release by the EuropeanCommission of the index of household sentiment in the eurozone, for aclearer picture of the world's economy, the dealers added.

Before the central bank's intervention, the Taiwan dollar extended its strength and moved slightly higher against the U.S. dollar as many traders embraced the hope that the major central banks of the world will come up with more stimulus measures to boost the economy, the dealers said.

In particular, expectations remained alive that the U.S. Federal Reserve will pump further funds into the market, a move that is expected to prompt liquidity to spill over into Asia and lend support to regional currencies, they said.

A net buy of NT$1.87 billion (US$62 million)-worth of local shares made by foreign institutional investors also boosted demand for the Taiwan dollar, they added.

(By Kao Chao-fen and Frances Huang)
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