Taipei--The U.S. dollar fell against the Taiwan dollar on Monday, shedding NT$0.099 to close at NT$30.527, reflecting a fall in the U.S. dollar index three sessions in a row, dealers said.
The weakness of the U.S. dollar indicates caution over the future movement of the currency, giving a boost to other regional units, in particular the South Korean won, which prompted local traders to buy Taiwan dollars, they said.
The greenback opened at NT$30.540 and moved between NT$30.465 and NT$30.600 before the close of trading. Turnover totaled US$726 million during the session.
Soon after the local foreign exchange market opened, the U.S. dollar faced heavy selling as local traders took their cue from the falling U.S. dollar index, which tracks the greenback against the six currencies of Washington's major trading partners, such as the Japanese yen and the euro, to dump the U.S. currency, dealers said.
After wrapping up a two-day policymaking meeting on March 15, the U.S. Federal Reserve said it will raise interest rates in a "gradual" manner and hinted at three rate hikes for this year instead of four the market had anticipated.
Foreign investors continued to move funds into the region and lifted the won, which the Taiwan dollar follows closely, to a five-month high against the U.S. dollar, with the local currency following suit to post gains, dealers said.
Foreign institutional buying in the equity market lent further support to the Taiwan dollar, dealers said. According to the Taiwan Stock Exchange, foreign institutional investors bought a net NT$2.78 billion (US$91.07 million) worth of shares on the main board on Monday.
Source: Focus Taiwan News Channel