NT dollar falls to three-month low; businesses relieved

The New Taiwan dollar fell yesterday to a new three-month low since Jan. 11 due to a continuously rising US dollar, to the great relief of Taiwan's small businesses, market watchers said yesterday.

In light of a strong US dollar, a wide expectation that the US Federal Reserve will keep on raising interest rates and coupled with promising economic data, there is ample room for the local currency to further lose value against the greenback, foreign currency exchange analysts predicted, noting that the Japanese yen and the South Korean won have also remained at relatively low levels in recent days.

The NT dollar traded NT$0.243, or 0.8 percent, lower against the US dollar to close at NT$32.04 on the Taipei foreign exchange market.

Turnover was US$1.23 billion, up from US$713 million the previous day.

During a plenary congress of the National Association of Small and Medium Enterprises (中小企業協會) held June 23 in Taipei, members passed a resolution to ask the government to pay greater heed to the negative impact of an appreciating local currency, which by that time had gained 6.2 percent in value against the US unit since November last year.

Although the Japanese yen and Korean won also appreciated during the same period, an association spokesman said that most Taiwan-made products, apart from some hi-tech goods, are unprofitable or even money-losing.

China's failure to lift the value of the yuan has made it even harder for Taiwan companies to compete in the world market, the spokesman added.