NT dollar reaches six-week high on global speculation


Tue, Mar 24, 2009 - Page 12

The New Taiwan dollar traded near a six-week high against the dollar on speculation a global stocks rally buoyed overseas demand for emerging-market assets. Bonds were steady.

The currency edged up less than 0.1 percent, extending a five-day rally, as the TAIEX index advanced 3.3 percent.

A government report released after yesterday’s market close showed the jobless rate climbed to 5.63 percent last month, the highest since records began in 1978.


“You can expect Taiwan’s dollar, along with other Asian currencies, to be a bit volatile even during a general rally,” said Joseph Lau, an economist at Credit Suisse in Hong Kong.

“We still haven’t seen that much upside on the export side and it’s pretty clear that domestic demand will further contract this quarter,” he said.

The NT dollar rose to NT$33.785 at the 4pm close, the strongest level since Feb. 6, according to Taipei Forex Inc.


The benchmark TAIEX touched 5,124.18, its strongest level since Oct. 15. Overseas investors added to their holdings of Taiwanese shares yesterday.

The Ministry of Economic Affairs yesterday reported an 8.2 percent drop in February wholesale, retail and food sales, compared with a 18.8 percent slump in January.

“I doubt the rise in the jobless rate, or any specific data, would trigger any major moves because the trends have been pretty clear in the past few months anyway,” Lau said.

“In general, there would still be capital inflows to Taiwan, but like the case of South Korea, the currencies might be under sustained selling pressure since people suspect the rallies might be bottoming out,” he said.


The government will report February export orders and industrial production figures today after the 4pm market close.

Orders probably fell 29 percent, after a 42 percent drop in January, according to a Bloomberg News survey of economists.

The yield on the 1.375 percent bond maturing March 2019 climbed 1 basis point to 1.53 percent, according to GRETAI Securities Market, the nation’s biggest exchange for bonds.

Its price fell 0.052, or NT$52 per NT$100,000 face amount, to 98.6132.