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

2017/05/16 18:25:33 fontsize-small fontsize-default fontsize-big
U.S. dollar closes lower on Taipei forex (update)

Taipei, May 16 (CNA) The U.S. dollar fell against the Taiwan dollar Tuesday, shedding NT$0.043 to close at NT$30.115 as the strength of other regional currencies encouraged traders here to dump the U.S. unit in the local market, dealers said.

The gains by the currencies in the region reflected eased concerns over a possible rate hike by the U.S. Federal Reserve in June, while a decision by the People's Bank of China to raise the Chinese yuan's reference rate against the U.S. dollar gave an additional boost to non-U.S. dollar units in the region, dealers said.

The U.S. dollar closed lower against the Taiwan dollar Tuesday for the fourth consecutive session.

The greenback opened at the day's high of NT$30.130, and moved to a low of NT$30.057 before rebounding. Turnover totaled US$723 million during the trading session.

Soon after the local foreign exchange market opened, the U.S. dollar staged a technical rebound from its slump against the Taiwan dollar in the previous session, but then fell into negative territory as regional currencies gained, dealers said.

Buying in the regional currencies, including the Taiwan dollar, resulted from a report of lower-than-expected manufacturing activity in New York, which lowered expectations that the Fed would decide on a rate hike soon, dealers said.

Data released Monday by the New York Fed showed that the general business conditions index fell from 5.2 in April to minus 1.0 in May, indicating a contraction in regional manufacturing activity.

In addition, with a higher yuan reference rate against the U.S. dollar, the Chinese currency moved higher against the greenback for the third straight day on Tuesday, giving a hint to traders here to buy into the Taiwan dollar, dealers said.

While the local equity market fell slightly Tuesday, foreign institutional investors remained on the buy side, registering a small net buy of NT$747 million (US$24.80 million), which also helped drive the Taiwan dollar's gains, dealers said.

(By Bernie Chiu and Frances Huang)
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