The US dollar on Friday rose in line with higher US Treasury yields, as investors focused on when the US Federal Reserve is likely to begin reducing its asset purchases.
The New Taiwan dollar yesterday dropped against the US dollar on a make-up Saturday for the Mid-Autumn Festival holiday, losing NT$0.020 to close at NT$27.710, down 0.03 percent from a week earlier.
The greenback has risen from a one-month low on Friday last week after jobs data for last month showed that jobs growth slowed, while wage inflation rose more than expected.
However, the currency has not yet been able to establish a strong trend, as investors wait for new clues about when the Fed is likely to begin paring its bond purchases and, eventually, increase rates.
“That to me is the most important thing, is when does the Fed hike rates, and unfortunately we may not know that for a little while,” said Erik Nelson, a macro strategist at Wells Fargo & Co in New York.
Cleveland Fed President Loretta Mester on Friday said that she would still like the central bank to begin tapering asset purchases this year, joining a chorus of policymakers making it clear that their plans to begin scaling back support were not derailed by weaker jobs growth last month.
Fed officials are grappling with rising price pressures while jobs growth remains below their targets.
Data on Friday showed that US producer prices increased solidly last month, indicating that high inflation is likely to continue for a while, with supply chains remaining tight as the COVID-19 pandemic drags on.
The Wall Street Journal wrote that Fed officials would seek to make an agreement at the Fed’s meeting this month to begin paring bond purchases in November.
The US dollar index gained 0.17 percent to 92.64, up 0.66 percent from a week earlier.
The US currency had dipped earlier on Friday on improving risk sentiment on news that US President Joe Biden and Chinese leader Xi Jinping (習近平) spoke for the first time in seven months.
The US dollar was last down 0.13 percent to 6.4419 yuan.
The euro on Friday fell 0.07 percent to US$1.1816, a day after the European Central Bank said it would trim emergency bond purchases over the coming quarter.
Additional reporting by CNA, with staff writer
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