Taipei, Aug. 29 (CNA) The U.S. dollar fell against the Taiwan dollar Monday, shedding NT$0.021 to close at NT$29.039, pushed down by demand for the local currency from foreign institutional investors looking to jump into Taiwan's stock market, dealers said.
The greenback trended lower against most of the currencies in the region as traders were betting the U.S. central bank will continue to ease liquidity to shore up the economy, they said.
Turnover totaled US$607 million during the trading session.
The U.S. unit opened at US$29.060 and moved between NT$29.000 and NT$29.100 before the close.
Dealers said that following the gains posted on Wall Street at the end of last week, the local stock market extended the momentum right from the opening bell.
Foreign institutional investors resumed buying to pick up bargains across the board, lending support to the Taiwan dollar against the greenback, they said.
The benchmark weighted index rose 1.78 percent at 7,578.01 points, with foreign institutional investors buying a net NT$7.42 billion (US$255 million) in shares.
Forex traders also took hints from the strength of other Asian currencies, in particular the South Korea won, the Chinese yuan and the Malaysian ringgit, on expectations that the U.S. Federal Reserve will pump more funds into the market to aid the fragile economy, dealers said.
Though Fed Chairman Ben Bernanke did not announce a new round of quantitative easing in a speech on Aug. 26 as had been expected by the market, many traders still believed the U.S. central bank will use other monetary tools to raise the liquidity level, they said.
With U.S. inflation in check, investors have high hopes the Fed will come up with stimulus measures at a policy-making meeting scheduled for September, they added. (By Kao Chao-fen and Frances Huang) enditem/ls
