The Taiwan dollar eased on Tuesday on US dollar demand from oil-related firms and foreign institutions as the US subprime problems appeared to be contained. The Taiwan dollar ended weaker at T$33.025 to the US dollar from the previous close of T$33.007, with the central bank selling some US dollars to curb the local currency's fall.
The Taiwan dollar had opened stronger at T$32.977. Volume on the main Taipei Forex Inc exchange was moderate at US $735 million, higher than US $610 million in the previous trade. "Oil firms and foreign institutions have been buying up US dollars. Some offshore investors also went long on the US dollar," said a dealer in Taipei. Importers and fund management firms usually need US dollars for their overseas purchases and investments.
Federal Reserve Chairman Ben Bernanke and US President George W. Bush spoke last week to try to appease worries over US credit mortgage problems that have roiled the markets. On Tuesday, foreign institutions bought a net T$3.964 billion (US $120 million) of Taiwan stocks, which fell 0.63 percent, although they sold a net T$171.4 billion for the whole of August.
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