Bloomberg News

Taiwan Dollar Falls on U.S. Growth Concern; Bonds Little Changed

March 29, 2012

Taiwan’s dollar weakened for the first time in three days as worse-than-expected U.S. economic data sapped demand for riskier assets. Government bonds were little changed.

The MSCI Asia-Pacific Index of stocks dropped after official a report released yesterday showed orders placed with U.S. factories for durable goods rose 2.2 percent in February, less than the 3 percent gain economists estimated in a Bloomberg survey. Global funds sold $70 million more Taiwanese shares than they bought in the first four days of the week, according to exchange data.

“The stock market is getting hit by the mediocre U.S. data overnight,” said James Wang, a debt trader at Yuanta Securities Co. in Taipei. “Investors are still unsure whether we’re seeing a solid U.S. recovery.”

Taiwan’s dollar weakened 0.04 percent to NT$29.582 against its U.S. counterpart, according to Taipei Forex Inc. The currency has appreciated 2.4 percent this quarter. One-month implied volatility, a measure of exchange-rate swings that traders use to price options, was unchanged at 4 percent.

The yield on the 1 percent notes due January 2017 was 0.996, compared with 0.992 percent yesterday, according to Gretai Securities Market. That was the lowest rate for benchmark five- year yields since March 19.

The overnight money-market was steady at 0.409 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 awong268@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net


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