The New Taiwan dollar on Friday fell against the US dollar, shedding NT$0.060 to close at NT$30.210, sliding 0.6 percent from NT$30.040 a week earlier.
Turnover totaled US$1.525 billion during the trading session.
The greenback opened at NT$30.260 and moved between NT$30.125 and NT$30.290 before the close.
Elsewhere on Friday, the US dollar surged, posting sharp gains against the safe-haven Japanese yen as stock markets recovered globally and investors cheered efforts by governments and policymakers to address the economic fallout from the COVID-19 pandemic.
The US dollar posted its largest daily percentage gain against the yen since April 2013. It also benefited after US President Donald Trump on Friday declared a national emergency over the quickly spreading coronavirus, opening the door to more federal aid to combat the disease.
The greenback extended gains against several currencies after a blowout in swap spreads on Thursday signaled that investors want US dollars. While those spreads came in on Friday, the US dollar held strong.
However, market participants said that signs of US dollar funding stress persist and policymakers probably need to do more.
“Underlying concerns regarding the economic fallout from the coronavirus on credit markets broadly remain,” Toronto-based Bank of Nova Scotia chief foreign exchange strategist Shaun Osborne said.
“It may be tempting to look for signs of a low in global stocks, but with the underlying issue — the coronavirus — still unchecked, we think that is premature at this point,” he said.
The cost of raising US dollar funds in the cross-currency euro swap market on Friday widened again after narrowing the day before on the US Federal Reserve’s announcement that it would inject more liquidity into the banking system, he added.
Wider spreads in the cross-currency basis swap market suggested increased signs of US dollar shortage for corporates seeking funding.
In afternoon trading, the US dollar gained 3.2 percent against the yen to ￥108.03.
Wells Fargo & Co said that it had further upgraded its forecast for the yen against the US dollar as the risk of financial turmoil remains, adding that the greenback would fall to less than ￥100.
“The rate cuts and other policy actions from global central banks have done little to quell market panic. That may be due to the fact that fiscal policymakers have generally been slow to act,” Wells Fargo said in a research note.
The US dollar also rallied versus another safe haven, the Swiss franc, rising 0.6 percent to SF0.9496.
Against a basket of currencies, the US dollar rose 1 percent to 98.467.
The euro nursed losses, despite European Central Bank (ECB) policymakers’ efforts to reassure markets. European assets were on Thursday sold off after investors were underwhelmed by the ECB’s stimulus measures.
The euro was last down 0.7 percent at US$1.1108.
The ECB on Thursday announced a stimulus package that provides loans to banks with rates as low as minus-0.75 percent and increases bond purchases, but it did not join its counterparts in the US and the UK in cutting rates.
The British pound also plunged 2.2 percent against the US dollar to US$1.2290.
The greenback’s rebound this week reflects its role as the world’s most liquid currency, which investors seek in times of stress.
The Fed meets next week and many analysts now expect it to chop its own target policy rate, quite possibly to zero, and give markets new guidance about how it plans to combat the economic fallout from the coronavirus.
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