twd 27 nov

16:22 27Nov2008 RTRS-Taiwan dollar hits 1-½ week high on exporter purchases

(Adds details, quotes)
TAIPEI, Nov 27 (Reuters) - The Taiwan dollar firmed to a 1-½ week high on Thursday, boosted by exporter purchases and big domestic stock market gains, and supported by investors pulling back on U.S. dollar buying ahead of the Thanksgiving holiday.
The Taiwan dollar hit a high of T$33.167 to the U.S. dollar during early trade, but erased most of those gains to close at T$33.302, its highest finish since Nov. 19 and up slightly from Wednesday's close of T$33.306.
It was also the Taiwan dollar's third consecutive daily rise.
Volume on the main Taipei Forex Inc. exchange was thin at $788 million, lower than Wednesday's $997 million, and well off the average billion dollar mark seen on many trading days.
"The Taiwan dollar was supported by the stock market's rise today, but volume is quite low so we really can't say it's very significant," a dealer in Taipei said.
"Exporters were also buying Taiwan dollars but this was offset by intervention by the central bank."
Exporters, who prefer a weaker Taiwan dollar, usually convert their U.S. dollar earnings to the local currency near the end of the month for cash needs at home.
Thanksgiving weekend in the United States also contributed to lower trading volume, as investors were unable to see a clear direction from the U.S. dollar.
"The market won't be open tonight, so people stayed away because we don't know what's going to happen between now and Monday," said another dealer.
The 4.26 percent rise in the TAIEX share index <.TWII> also helped to boost the Taiwan dollar somewhat, although gains in the currency were limited by potential fears of a lengthened economic crisis.
"I don't think anyone was expecting the stock market or the dollar to rise as fast as they have, so it's all looking a little ridiculous," the second dealer said, adding he expected the Taiwan dollar to find support at about T$33.150.
Six-month NDFs were quoted at -0.210/-0.150 compared to Wednesday's close of -0.220/-0.150, meaning the market saw the Taiwan dollar weakening more than previously expected.
On the smaller Cosmos exchange , the Taiwan dollar rose to T$33.295 to the U.S. dollar from Wednesday's close of T$33.320.
(Reporting by Kelvin Soh and Lin Miao-jung; Editing by Anne Marie Roantree)
((kelvin.soh@thomsonreuters.com; +886 2 2508-0815; Reuters Messaging:kelvin.soh.reuters.com@reuters.net))

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Thursday, 27 November 2008 16:22:13RTRS [nTP167873] {EN}ENDS