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16:53 27Feb09 RTRS-Taiwan dollar at 6-yr low on econ fears, outflows * Taiwan dollar weakens to six-year low, breaks T$35 barrier * Weighed down by fund outflows, regional peers and economy * Exporters fail to provide support (Updates values, adds details) TAIPEI, Feb 27 (Reuters) - The Taiwan dollar weakened to a more than six-year closing low on Friday, briefly breaking the key T$35 barrier, as record jobless figures and foreign fund outflows weighed on the local currency. The Taiwan dollar broke through the psychological T$35 to the U.S. dollar barrier in afternoon trade, but later pared some of those losses to close the session at T$34.950, its weakest close since Oct. 16, 2002. It was weaker than Thursday's close of T$34.850. Volume on the main Taipei Forex Inc exchange was moderate at $1.034 billion, higher than Thursday's $765 million. "Although the central bank says market forces should decide the strength of the Taiwan dollar, it cannot sit idly by as other regional currencies depreciate," said a dealer in Taipei. The central bank, which keeps the Taiwan dollar in a managed float, has been intervening in the foreign exchange market to depreciate the local currency. Such a move helps makes locally produced goods manufactured on Taiwan dollar costs cheaper in overseas markets. Other economies in the region have also been adopting similar policies, with the South Korean won hitting an 11-year low on Friday. [ID:nSEO210948] Taiwan's January seasonally adjusted jobless rate rose to a record high of 5.33 percent as the island suffers from possibly its longest recession and ignites fears of a protracted slowdown. [ID:nTP48392] Foreign funds sold a net total of T$1.64 billion ($46 million) worth of shares on Friday, bringing their total net sale this month to T$14.97 billion. Exporters, who are usually active at the end of the month, failed to provide the usual support for the Taiwan dollar as fund inflows slowed to a trickle amid falling demand for the island's exports in overseas markets, dealers said. On the smaller Cosmos exchange , the Taiwan dollar closed at T$34.935 compared to Thursday's close of T$34.846. (Reporting by Kelvin Soh and Jeanny Kao) ((kelvin.soh@thomsonreuters.com; +886 2 2508 0815; Reuters Messaging: kelvin.soh.reuters.com@reuters.com)) Keywords: MARKETS TAIWAN CURRENCY/
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