Taipei, July 28 (CAN) The U.S. dollar rose against the Taiwan dollar Monday, gaining NT$0.002 to close at the day's high of NT$30.037 as the greenback recouped earlier losses on the back of buying by the local central bank, dealers said.
Before the central bank's intervention, the U.S. dollar weakened in the local market as traders were encouraged by the continued strength of some other regional currencies in the region to raise their Taiwan dollar holdings, the dealers said.
Market sentiment remained cautious ahead of a two-day policymaking meeting of the U.S. Federal Reserve scheduled to take place the following day, they added.
The greenback opened at NT$30.037 and moved to a low of NT$29.960 before rebounding. Turnover totaled US$554 million during the trading session.
After opening higher on a technical rebound, the U.S. dollar fell into the red in the wake of the gains posted by some other regional currencies, in particular the South Korean won and the Chinese yuan, the dealers said.
The won got a boost from a move by Korean exporters to bring back funds from overseas and another move by foreign institutional investors to pick up Korean shares, gaining 0.19 percent at one point, which served as an indication to traders here to buy into the Taiwan dollar, the dealers said.
The yuan further strengthened to rise 0.09 percent against the U.S. dollar at one point amid rising optimism toward China's economy following signs of improving manufacturing activity, they added.
In Taiwan, foreign institutional investors bought a net NT$2.65 billion (US$88.22 million)-worth of local shares to push up demand for the Taiwan dollar, the dealers said.
After stepping into the market in the latter part of the session, the local central bank pushed the U.S. dollar back up to the NT$30 mark at the close in a bid to boost Taiwanese exports, the dealers said.
Despite the intervention, turnover in the local currency market remained moderate, as many traders stayed on the sidelines waiting for the results of the Fed meeting, to gain more information about the U.S. dollar's future movement, they said.
(By Frances Huang)