The New Taiwan dollar dropped for a third day against the greenback yesterday due to continued foreign fund outflows. The local unit closed at NT$32.513 on the Taipei foreign exchange market, down NT$0.293 from the previous day.
The NT dollar had fallen as low as NT$32.58 -- the weakest since April 4 -- against the greenback during the day in the face of continuing political uncertainty.
The Chinese Nationalist Party (KMT) on Wednesday said it was planning to push a motion to recall President Chen Shui-bian (陳水扁) amid allegations of improper share trading by his family. However, the Democratic Progressive Party blasted the opposition party's recall motion as a plot to seize power.
``The Taiwan dollar is down owing to political uncertainty, which is driving people to get out of Tai-wanese assets,'' said Gary Huang, a currency trader at Union Bank of Taiwan (聯邦銀行).
The local currency also dropped as investors turned net sellers of the nation's equities in the past few days, according to Taiwan Stock Exchange data. Institutional investors sold a net NT$35.13 billion (US$1.08 billion) worth of stocks over the past four days, it said.
The NT dollar was also pressured by a stronger US dollar after Federal Reserve Bank of Atlanta president Jack Guynn said overnight in Duluth, Georgia, that the US central bank's paramount goal was to keep inflationary pressures at bay, even if it means tightening rates as growth cools.