Taipei--The U.S. dollar fell against the Taiwan dollar on Thursday, shedding NT$0.068 to close at NT$30.370 as local exporters rushed to raise their holdings in the local currency to meet fund demands, dealers said.
The strength of other currencies in the region and a rebound by the local equity market placed downward pressure on the U.S. dollar, stopping a two-session streak of gains for the U.S. unit, they said.
The greenback opened at NT$30.360 and moved between NT$30.355 and NT$30.389 before the close of trading. Turnover totaled US$587 million during the session.
Soon after the local foreign exchange market opened, the U.S. dollar encountered selling as Taiwanese exporters dumped their greenbacks in exchange for the Taiwan dollar, to meet seasonal fund demands with the current quarter approaching an end, dealers said.
The U.S. dollar index, which tracks the currencies of Washington's six major trading partners weakened, pushing up regional currencies such as the South Korea won and the Chinese yuan, which gave a strong hint to local traders to buy Taiwan dollars, dealers added.
Foreign institutional investors shifted to the buy side for local equities as the local stock market bounced back from a slump seen a session earlier, giving the Taiwan dollar a further boost against the U.S. dollar, dealers said.
According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$4.09 billion (US$135 million) worth of shares on the main board, sending the weighted index up 0.30 percent at the close on Thursday. A session earlier, foreign institutional investors recorded net sales of NT$1.29 billion.
Seasonal fund demand from local exporters is expected to continue to the end of this week, the last day of the quarter, so the Taiwan dollar could continue its uptrend, dealers said.