U.S. dollar tops NT$33 mark, hits highest level since 2016

Taipei, Jan. 13 (CNA) The U.S. dollar closed above the NT$33 mark Monday, hitting its highest level against the Taiwan dollar in almost nine years amid concerns that the U.S. Federal Reserve will slow down the pace of its rate cuts, dealers said.

The greenback opened at the day's low of NT$32.980 and moved to a high of NT$33.136 before closing at NT$33.119, the highest close since March 9, 2016, when the greenback ended at NT$33.225 against the Taiwan dollar.

The U.S. dollar got a significant boost from a spike in the U.S. dollar index, which tracks the value of the greenback against the currencies of Washington's six major trading partners, dealers said.

The strong U.S. dollar index came after nonfarm payroll data showed the U.S. economy adding 256,000 jobs in December, far outpacing expectations of around 153,000 jobs, a sign of strong economic activity that dampened hopes of fast-paced Fed rate cuts.

Another factor putting pressure on the Taiwan dollar was a sell-off on the local stock market, as the Taiex, the Taiwan Stock Exchange's benchmark weighted index, plunged more than 500 points to close below the 22,500-point level.

On Monday, foreign institutional investors recorded a net sell of NT$55.60 billion in shares on the exchange, the 11th highest net sell in history, and moved their funds out of the local market to chase U.S.-denominated assets, dealers said.

At the same time, Taiwan's exporters appeared reluctant to sell their U.S. dollars in exchange for the Taiwan dollar for the time being in anticipation that the greenback will go higher in the future, dealers said.

The Taiwan dollar was not the only non-U.S. dollar currency to come under pressure as all Asian currencies moved lower against the greenback on Monday.