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

2017/08/21 19:26:43

Taipei, Aug. 21 (CNA) The U.S. dollar fell against the Taiwan dollar Monday, shedding NT$0.004 to close at NT$30.328 as traders here were encouraged by the strength of the South Korean won to buy into the local currency, dealers said.

The losses suffered by the U.S. dollar were capped, however, by foreign institutional selling in Taiwan's stock market, which has been in consolidation mode, they said.

The greenback opened at the day's high of NT$30.340, and moved to a low of NT$30.305 before rebounding. Turnover totaled US$408 million during the trading session.

Soon after the local foreign exchange market opened, the U.S. dollar moved higher on follow-through buying from a session earlier, but it then lost momentum as traders reacted to a stronger won, which the Taiwan dollar tracks closely, dealers said.

The won gained about 0.25 percent against the U.S. dollar at one point during the day despite geopolitical unease when the United States and South Korea started a joint military drill on Monday.

A higher won prompted traders here to raise their Taiwan dollar holdings, helping the local currency recoup its earlier losses, dealers said.

As the Taiwan dollar continued to move higher, its momentum was limited by foreign institutional selling in Taiwan's stock market, they said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$2.55 billion (US$84.08 million) in shares on the exchange on Monday, when the weighted index closed up only 0.05 percent.

Turnover in the foreign exchange market on Monday was relatively low as many traders preferred to stay on the sidelines, waiting to see what comes out of an annual central bank meeting scheduled for Friday in Jackson Hole, Wyoming, dealers said.

Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi are expected to speak in the meeting.

(By Chiu Po-sheng and Frances Huang)