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

Taipei-The U.S. dollar fell against the Taiwan dollar Tuesday, shedding NT$0.028 to close at NT$30.300 as other regional currencies moved higher, prompting local traders to raise their holdings in the local unit, dealers said.

A rebound staged by the local foreign exchange market on the back of foreign institutional buying in equities also placed downward pressure on the U.S. dollar, which closed at its lowest since Aug. 9, when it finished at NT$30.218 against the Taiwan dollar, they said.

The greenback opened at NT$30.314 and moved between NT$30.284 and NT$30.319 before the close of trading. Turnover totaled US$406 million during the session.

Soon after the local foreign exchange market opened, the U.S. dollar came under pressure on follow-through selling from the earlier session and the weakness continued as local traders took their cue from the strength of other regional currencies, including the South Korean won, to buy into the Taiwan dollar, dealers said.

With traders in the region shrugging off concerns over geopolitical unease at a time when a joint U.S-South Korean military exercise is taking place, the won rose about 0.45 percent against the greenback at one point.

A rising won encouraged local traders to raise their Taiwan dollar holdings throughout the session, dealers said.

Foreign institutional buying in the local equity market saw the main board rebound, lending more support to the Taiwan dollar, dealers added.

According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$3.95 billion (US$130 million) worth of shares on the main board, sending the weighted index up 0.64 percent at the close on Tuesday.

Turnover on the local foreign exchange market remained thin as many traders took to the sidelines ahead of the annual global central bank meeting scheduled to start later in the week in Jackson Hole, Wyoming, dealers said.

Source: Focus Taiwan News Channel