COST OF LIVING/U.S. dollar closes at new 68-month high on Taipei forex

09/28/2022 08:57 PM
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CNA file photo
CNA file photo

Taipei, Sept. 28 (CNA) The U.S. dollar rose against the Taiwan dollar Wednesday, gaining NT$0.091 to close at NT$31.871.

The increase pushed the greenback closer to the NT$32 mark, a level last seen in early January 2017, market data showed.

The U.S. dollar opened at the day's low of NT$31.79, and moved to a high of NT$31.889 before the end of trading. Turnover totaled US$1.425 billion during the session.

In a report submitted to the Legislative Yuan that day, the central bank said it undertook net sales of US$8.25 billion to reduce volatility in the value of the Taiwan dollar on the Taipei forex market during the first six months of this year.

On Wednesday, the U.S. dollar rose 0.29 percent against the Taiwan dollar, compared to the greenback's 1.28 percent gain against the South Korean won, and 1.08 percent rise against the Chinese yuan, the central bank said in a press statement.

The Taiwan dollar has dropped 13 percent against the U.S. dollar so far this year because of the United States Federal Reserve's adoption of tighter monetary policy to combat inflation.

A series of aggressive interest rate hikes in the U.S. has boosted the strength of the greenback, with foreign investors selling stocks in Taiwan to move funds to the U.S., the central bank said.

Last week, the U.S. Federal Reserve raised benchmark interest rates by 75 basis points, while Taiwan's central bank announced its third 12.5 basis point hike this year.

The central bank has sought to slow the depreciation of the Taiwan dollar, because as a small and open economy Taiwan is highly reliant on trade.

The central bank said in early September that Taiwan's foreign exchange reserves dropped US$2.329 billion in August, due to its intervention in the foreign exchange market to help prop up the Taiwan dollar.

The U.S. dollar breached the NT$30 mark on Aug. 19, before passing NT$31 on Sept. 14, and hitting its last high of NT$31.818 on Monday.

(By Pan Tzu-yu and Kay Liu)

Enditem/AW

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