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NT dollar gains slightly despite outflow

The New Taiwan dollar gained some lost ground against its US counterpart yesterday, rising NT$0.048 to close at NT$33.633 on the Taipei foreign exchange market, in line with a strong yen despite continued foreign fund outflows, dealers said.

Turnover was US$579 million, lower from US$745 million the previous day. For the week, the NT dollar fell 0.6 percent, adding to the 4.9 percent decline in the previous 10 weeks.

Overseas fund managers continued selling Taiwan stocks yesterday, resulting in a net sale of NT$39.818 billion (US$1.2 billion) of shares in the last eight sessions since Oct. 12, according to Taiwan Stock Exchange's statistics.

The fund outflows will add to sales of the local currency as overseas investors repatriate funds, said William Chou, a foreign-exchange analyst in Taipei at Hua Nan Commercial Bank (華南銀行).

"The central bank's attitude seems quite obvious, that it wouldn't buy Taiwan dollars to warn people against betting on the US currency," Chou said. "The central bank probably wants to help bolster the economy, which is export-dependent."

The NT dollar may trade in a range of NT$33.50 to NT$33.70 next week, he said.
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