Taiwan’s Dollar Declines for a Second Day on Japan’s Crisis
Taiwan’s dollar dropped for a second day on concern the impact of Japan’s nuclear disaster will curb export growth.
Overseas funds sold more local stocks than they bought for the first time in 12 days yesterday as Japan raised the severity rating of the accident at the Fukushima Dai-Ichi nuclear plant to the highest level. Damage stemming from the crisis may reduce Taiwan’s economic growth by as much as 0.2 percentage point, Premier Wu Den-yih said on March 29. Domestic bonds were steady.
“There are some outflows, so the Taiwan dollar has got some pressure,” said Albert Lee, a fixed-income trader at Cathay United Bank in Taipei. “We’ll wait until the Japan situation gets more stable. No one wants to sell bonds and no one wants to buy either.”
Taiwan’s dollar fell 0.2 percent to NT$29.157 against its U.S. counterpart as of 9:38 a.m. local time, according to Taipei Forex Inc. The local dollar has advanced 4.2 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 unchanged at 1.344 percent, according to Gretai Securities Market, the island’s biggest exchange for bonds.
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