NT$ ends lower on government bank's buying of US$

Taipei, June 11, 2003 (CENS)--The New Taiwan dollar ended slightly lower yesterday against its U.S. counterpart due to strong buying of the U.S. dollars by state-controlled banks, dealers said.

The local unit closed at NT$34.677, down from Monday's NT$34.662. Total turnover at the Taipei Foreign Exchange rose to US$322 million from NT$255 million in the previous session. The NT$ fluctuated between NT$34.642 and NT$34.680.

Dealers said that the state-run Farmers Bank of China bought an estimated US$60 million on behalf of the government for military equipment purchases, which weighed down the N.T. dollars.

Meanwhile, foreign investors sold a net of NT$850 million worth of shares in the local bourse, after net purchases in recent sessions, which many dealers said might be a sign they are ready to lock in profits. Demand for the U.S. dollars will be strong as foreign investors begin converting their investment gains into the greenback for outward remittances, dealers said.

Meanwhile, the overnight interbank average interest rate stood at 1.175%, down slightly from 1.176% in the previous session, though the Central Bank of China released NT$21 billion in funds into the market through the repurchase of short-term bills.

The central bank bought in NT$21 billion worth of bills at 1.175% through repurchase agreements, dealers said.

During the session, the central bank also sold NT$30 billion in 10-year government bonds at an average yield of 1.41%. After the auction, the bonds were quoted around 1.412% and 1.4075%, dealers said.