The Taiwan dollar ended lower in light trade on Saturday when international currency markets were closed over the weekend, with the focus next week on the yen and the movement of local shares. The Taiwan dollar was trapped in a tight range before ending at T$33.106, compared with Friday's T$33.101 close.
Volume on the main Taipei Forex Inc exchange stood at US $253 million, down from US $628 million in the previous session. The market opened today to make up for the Tomb Sweeping Daybreak last week. Despite the recent weakness, dealers saw limited downside for the local dollar if foreign investors continue pouring money into Taiwan to buy local stocks.
"If Taiwan stocks continue to rise, foreign fund inflows can support the Taiwan dollar," a dealer at a foreign bank said. Helped by a 0.54 percent rise on Taiwan's main TAIEX index, foreign investors bought a net T$1.33 billion ($40 million) worth of local shares on Saturday. Insurance firms and domestic funds have been buyers of US dollars recently for their overseas investments.
Dealers said they expected to the Taiwan dollar to trade between T$33.000 and T$33.150 in the short term. On the smaller Cosmos exchange, the Taiwan dollar was at T$33.107 to the US dollar, a touch lower than the previous close of T$33.105.
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