Taipei, Nov. 20 (CNA) The U.S. dollar rose against the Taiwan dollar Monday, gaining NT$0.001 to close at NT$30.102 with local traders motivated by the losses suffered by other regional currencies to cut their holdings in the local unit, dealers said.

Further foreign institutional selling in local equities placed more pressure on the Taiwan dollar and pushed the U.S. dollar higher throughout the session, they said.

The greenback opened at the day's high of NT$30.120 and moved to a low of NT$30.081 before rebounding. Turnover totaled US$534 million during the trading session.

Soon after the local foreign exchange market opened, the U.S. dollar staged a technical rebound against the Taiwan dollar from a slump in the earlier session and the strength continued on the back of the downturn in other regional currencies, dealers said.

The South Korean won, which the Taiwan dollar follows closely, fell about 0.3 percent against the U.S. dollar at one point, prompting local traders to buy into the greenback, dealers added.

A downtrend on the local equity market also drove the Taiwan dollar lower on the back of foreign institutional selling of large cap stocks, in particular in the bellwether electronics sector, dealers said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$2.56 billion (US$85.04 million) worth of shares on the main board, sending the weighted index down 0.35 percent at the close of trading Monday.

However, a move by the People's Bank of China to raise the Chinese yuan's reference rate against the U.S. dollar lent support to the Taiwan dollar, letting some air out of the greenback in the local foreign exchange market, dealers said.

Turnover on the foreign exchange market remained moderate with many traders on the sidelines, watching closely whether the U.S. Senate will pass a tax reform bill by the end of the year as the government expects, dealers added.

(By Frances Huang)
Enditem/AW