The Taiwan dollar fell on Friday from a one-week closing high in the previous session as a lack of detail on a European Union deal to support Greece dampened demand for riskier emerging market currencies. Local banks also bought the safe haven US dollar ahead of the week-long Lunar New Year holiday, dealers said, on fears that the local currency may come under pressure when markets re-open on February 22.
"Nobody wants to be caught with too many Taiwan dollars now that trade is going to stop for a week," said a dealer in Taipei. "Everyone would rather keep US dollars." Taiwan's foreign exchange market will be closed from February 15-19 for the Lunar New Year holiday. Globally, the euro fell broadly against key currencies after European leaders sought to prop up Greece with words of support at a summit on Thursday, but failed to make concrete pledges.