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

2017/12/01 19:51:42

Taipei, Dec. 1 (CNA) The U.S. dollar rose against the Taiwan dollar Friday, gaining NT$0.018 to close at NT$30.028 as foreign institutional investors continued to stand on the sell side on the local equity market, dealers said.

Cautious sentiment dominated trading on the foreign exchange market as traders in the region watched closely the progress of a tax reform bill on the floor of the U.S. Senate, they said.

The U.S. dollar closed at the highest level in almost two weeks on Friday and for the week the currency ended up NT$0.018 or 0.06 percent against the Taiwan dollar.

The greenback opened at NT$30.005 on Friday, and moved between NT$29.965 and NT$30.050 before the close. Turnover totaled US$877 million during the trading session.

After opening slightly low on a mild technical correction on Friday, the U.S. dollar regained its footing as traders took their cue from foreign institutional selling in equities to cut their holdings in the Taiwan dollar, dealers said.

According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$7.85 billion (US$261 million) worth of shares on the main board on Friday as the bellwether electronics sector remained sluggish.

The weakness of other regional currencies also paved the path for a higher U.S. dollar in Taiwan as many traders in the region waited to see whether a tax reform bill, which could impact growth in the world's largest economy, passes in the U.S. Senate, dealers said.

How the U.S. dollar moves will depend on when foreign institutional investors resume buying in the local equity market, while the greenback is expected to remain stable amid expectations of a rate hike by the U.S. Federal Reserve later in the month, they added.

The Fed has scheduled a policymaking meeting for Dec. 12-13 and a rate increase is widely anticipated by the market, dealers added.

(By Chiu Po-sheng and Frances Huang)