Taipei--The U.S. dollar rose against the Taiwan dollar Thursday, gaining NT$0.091 to close at NT$30.309, as foreign investors moved funds out of the country after receiving cash dividends from local listed companies, dealers said.
The weakness of the Taiwan dollar also reflected escalating geopolitical tensions between North Korea and the United States, which sent the U.S. dollar to its highest level since July 26 when it closed at NT$30.402.
The greenback opened at NT$30.245, and moved between NT$30.217 and NT$30.319 before the close. Turnover totaled US$909 million during the trading session.
Soon after the local foreign exchange market opened, the U.S. dollar moved higher against the Taiwan dollar on follow-through buying from the previous session and continued to rise on fund outflows from the country, dealers said.
The fund outflows became more apparent after Hon Hai Precision Industry Co. (??), an assembler of iPhones and iPads for Apple Inc., made its highest ever cash dividend payout of NT$77.98 billion.
As of Thursday, foreign institutional investors held a 53.36 percent stake in Hon Hai, according to the Taiwan Stock Exchange (TWSE).
In the forex market, traders on Thursday began moving their funds into U.S. dollar-denominated assets as a safe haven amid rising concerns over geopolitical tensions after North Korea said that it was planning to fire missiles into waters close to the U.S. Pacific territory of Guam "within days," dealers said.
However, the Taiwan dollar losses were capped by the strength of the Chinese yuan and by foreign institutional buying in local equities, dealers said.
According to TWSE data, foreign institutional investors bought a net NT$1.09 billion (US$35.97 million) worth of shares on the main board Thursday, while the weighted index dropped 1.34 percent by the close.
Source: Focus Taiwan News Channel