Taiwan’s dollar advanced, erasing earlier losses, on speculation overseas investors will add to holdings of the island’s assets as stocks rebounded. Government bonds were steady.
The currency gained for the first time in three days as the benchmark Taiex index of shares rose 0.6 percent. The local dollar fell the most since Feb. 24 yesterday on concern the impact of Japan’s nuclear crisis will curb export growth.
“We see signs of the change in momentum in the stock market, which is good for the currency market,” said Eric Hsing, a debt trader at First Securities Inc. in Taipei. Investor “confidence is still fragile,” he said.
Taiwan’s dollar rose 0.1 percent, reversing losses of 0.3 percent, to close at NT$29.089 against its U.S. counterpart, according to Taipei Forex Inc. The local dollar has advanced 4.4 percent this year, the best performance among Asia’s 10 most-traded currencies.
The Japanese government cut its assessment of the economy for the first time in six months today after the March 11 earthquake killed more than 12,000 and led to the worst nuclear crisis since Chernobyl. The nation bought 5 percent of Taiwanese exports in March, according to official data.
The yield on Taiwan’s 1.375 percent bond due March 2021 was little changed at 1.350 percent, according to Gretai Securities Market, the island’s biggest exchange for bonds.