Bloomberg News

Taiwan Dollar Has Weekly Gain on Growth Outlook; Bonds Decline

April 13, 2012

Taiwan’s dollar completed a weekly gain after data showed Asian economies are proving resilient to the global slowdown, improving the island’s export outlook. Government bonds fell.

The benchmark stock index rallied by the most in six weeks today after reports this week showed Singapore’s economy expanded faster than economists forecast last quarter, Philippine exports jumped by the most in 10 months in February and China had an unexpected trade surplus. Global funds bought $3.8 billion more Taiwanese shares than they sold this year, according to exchange data.

“Taiwan’s dollar is strengthening in line with other Asian currencies,” said Eric Hsing, a fixed-income trader at First Securities Inc. in Taipei. “The economy in Asia is stronger than the U.S. and Europe which will attract more global funds to the region.”

Taiwan’s dollar gained 0.1 percent this week to NT$29.528 against its U.S. counterpart, according to Taipei Forex Inc. It rose 0.1 percent today and touched NT$29.410 yesterday, the strongest level since April 5.

One-month implied volatility, a measure of exchange-rate swings traders use to price options, fell 10 basis points, or 0.10 percentage point, to 3.90 percent.

The yield on the government’s 1.25 percent bonds due March 2022 rose one basis point today and this week to 1.284 percent, according to Gretai Securities Market. The overnight money- market rate increased four basis points this week to 0.480 percent, according to a weighted average compiled by the Taiwan Interbank Money Center. It advanced two basis points today.

To contact the reporter on this story: Kyoungwha Kim in Singapore at kkim19@bloomberg.net

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


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