June 18 (Bloomberg) -- Taiwan’s dollar rallied for a fourth day after parties that support Greece’s bailout won enough seats to control parliament, boosting demand for emerging-market assets. Government bonds were steady.
The currency touched a two-week high as the MSCI Asia-Pacific Index of shares advanced by the most in a week. The New Democracy and Pasok parties took 162 seats in the 300-member parliament in weekend elections, easing concern the nation will leave the euro. Taiwan’s central bank will hold its benchmark interest rate at 1.875 percent on June 21, according to all 13 economists surveyed by Bloomberg.
“It looks like Greece has averted its immediate risks,” said George Pu, a bond trader at Sinopac Securities Corp. in Taipei. “Taiwan’s central bank will probably hold rates for now as it’s in a cautious mode.”
The island’s dollar strengthened 0.2 percent to NT$29.886 against its U.S. counterpart, according to Taipei Forex Inc. It touched NT$29.770 earlier, the strongest level since June 1. One-month implied volatility, a measure of exchange-rate swings used to price options, fell 34 basis points, or 0.34 percentage point, to 5.30 percent.
The yield on the government’s 1.25 percent bonds due March 2022 was little changed at 1.19 percent, according to Gretai Securities Market. The overnight interbank lending rate was steady at 0.509 percent, according to a weighted average compiled by the Taiwan Interbank Money Center.
To contact the reporter on this story: Andrea Wong in Taipei at firstname.lastname@example.org
To contact the editor responsible for this story: Sandy Hendry at email@example.com