Print

Mail

wiki links

New Taiwan dollar continues gains

The New Taiwan (NT) dollar yesterday rose NT$0.086 to close at NT$32.798 against the US dollar on the Taipei foreign exchange market as international investors bought Taiwan stocks.

Amid a hectic trading session, turnover was US$830 million yesterday, compared with US$461 million the day before.

"If the NT dollar fails to decline to the NT$32.85 level soon, it may break through the NT$32.5 level in the next week or two," said Jerry Ho (何昶逸), a foreign-exchange dealer at the International Bank of Taipei (台北國際商銀).

Ho said the NT dollar's quick appreciation was the result of the inflow of foreign capital into the domestic stock market. He said foreign investors were bottom-fishing amid signs of a robust economic recovery and rosy forecasts for Taiwanese stocks.

Foreign institutional investors bought NT$119 million worth of shares in Taiwan yesterday, according to the Taiwan Stock Exchange.

The NT dollar surged to NT$32.75 against it US counterpart at midday, reaching its highest level in almost three years. But traders said the nation's central bank appeared to have stepped in to intervene yesterday afternoon, preventing it from further appreciation.

If the global and domestic economies experience a solid upturn, Ho said, it is likely the NT dollar will break the NT$32.0 level by the end of the year.

With under-valued Asian currencies starting to appreciate, Taiwan's currency has been under pressure to gain, said Cheng Cheng-mount (鄭貞茂), vice president of Citibank Taiwan.

Yesterday's appreciation of the NT dollar was tied to the rise of the Singapore dollar and Korean won rather than to that of the yen, said Cheng, a former economist at the Taiwan Institute of Economic Research.

The yen yesterday closed at ?105 against its US counterpart. But Cheng said it is unlikely the yen will continue to rise and break through the ?100 level within the next six months.

Whether the NT dollar will break through the NT$32.5 level in the near future depends on the central bank, Cheng said.
This story has been viewed 3158 times.