twn dlr 0224

16:56 24Feb09 RTRS-Taiwan dollar weakens on Jan export orders, c.bank (Updates closing prices) TAIPEI, Feb 24 (Reuters) - The Taiwan dollar weakened on Tuesday as the island's dismal export orders in January prompted investors to sell local currencies, with the central bank intervening to push the currency even lower. The Taiwan dollar had been trading lower throughout the session. It dropped to a low of T$34.80 against the U.S. dollar shortly before ending at T$34.797, weakening from Monday's close of T$34.628. Volume on the main Taipei Forex Inc exchange was thin at $722 million, sharply lower than $1.027 billion a day earlier. "Some foreign banks bought the Taiwan dollar yesterday but sold the local currency today after seeing the gloomy export orders," said a dealer in Taipei. "The central bank also sold the Taiwan dollar near the market close." On Monday, the local currency rebounded from a near six-year intraday low after falling for 12 consecutive sessions previously, as financial institutions adjusted their positions after recent declines and on exporter deals. Government data on Tuesday showed that Taiwan's export orders, an indicator of the strength of global tech products and Asia's actual exports in coming months, fell by a record pace in January. [ID:nSP396732] The Taiwan dollar has fallen 6 percent so far since the beginning of this year, as the central bank tried to keep the local currency weak to support the island's sagging exports. Dealers said that unless export data improves, the Taiwan dollar will continue its downward trend near T$35. But the central bank is unlikely to let the currency weaken too quickly following complaints from some importers. A weaker Taiwan dollar will raise costs for importers when they convert their local currencies to the U.S. dollar for purchases overseas. In the non-deliverable forwards market, six-month NDFs narrowed to -0.070/-0.020 from -0.100/-0.050 in the previous session. That indicated investors bet the local currency will firm by a smaller degree in six months than previously expected. On the smaller Cosmos exchange , the Taiwan dollar weakened to T$34.770, compared with Monday's close of T$34.600. (Reporting by Gina Chang; Editing by Ken Wills) ((gina.chang@thomsonreuters.com; +886 2 2508-0815; Reuters Messaging:gina.chang.thomsonreuters.come@reuters.com)) Keywords: MARKETS TAIWAN CURRENCY/
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