Dec. 1 (Bloomberg) -- Taiwan’s dollar pared gains in the last minute of trading and finished with little change on speculation the central bank intervened to check appreciation that may hurt exports.
The central bank bought the U.S. dollar, according to two traders who declined to be identified. The currency rose as much as 1.4 percent today after China’s logistics federation said the Purchasing Managers’ Index climbed to 55.2 in November, more than the 54.8 median estimate in a Bloomberg survey, improving the outlook for the region’s exporters.
“China’s data shows demand for products from China and Asia remains strong, and that’s good for Taiwan’s economy,” said Hao-Yun Juan, a currency trader at King’s Town Bank in Taipei. “The Taiwan dollar is slowly retreating to NT$31 on the central bank’s effort to slow the currency’s gain.”
The Taiwan dollar finished little changed at NT$30.852 versus the greenback from NT$30.850 yesterday, according to Taipei Forex Inc. The currency was trading 1.4 percent stronger at NT$30.422 one minute before the 4 p.m. close.
Global funds bought $1.8 billion more local shares than they sold last month, boosting net purchases this year to $6.5 billion, exchange data show. Central Bank of China (Taiwan) Governor Perng Fai-nan said in parliament in Taipei on Nov. 29 that he wants to reduce speculative cash inflows by half from the current level.
The central bank has bought the U.S. dollar in late trading almost every day for the past seven months to curb gains in Taiwan’s currency, according to people familiar with the matter who declined to be identified because policy makers don’t usually reveal their market operations.
Taiwan’s government bonds were little changed, with the yield on the 2 percent note due July 2015 at 0.988 percent, compared with 0.990 percent yesterday, according to Gretai Securities Market, the island’s biggest exchange for bonds.
To contact the reporter on the story: Andrea Wong in Taipei at email@example.com
To contact the editor responsible for this story: Sandy Hendry at firstname.lastname@example.org.