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16:59 18May09 RTRS-Taiwan dollar slips on risk aversion in thin trade * U.S. dollar safe-haven appeal pressures Taiwan dollar * Local stocks up but foreign funds sell shares * Trade thin ahead of Taiwan GDP announcement this week (Updates to close) TAIPEI, May 18 (Reuters) - The Taiwan dollar weakened on Monday as the U.S. dollar gained global appeal as a safe-haven currency following renewed world recession fears, but trade was thin as some investors held back ahead of key economic data this week. The Taiwan dollar opened at T$33.150 against the U.S. dollar in early trade, its weakest intraday level since May 7, but pared those losses to close at T$32.994. It was still weaker than Friday's close of T$32.950. Volume on the main Taipei Forex Inc exchange was $930 million, up slightly from $879 million in the previous session. "Taiwan stocks were up, but foreign funds sold shares, so there wasn't any clear direction and investors just waited," said a dealer in Taipei. "The currency opened lower and stayed there." The Taiwan dollar fell from the open after the U.S. dollar rose globally on Friday as worries persisted about world economic prospects due to more evidence of recession in Europe and the United States, sparking widespread stock losses. Currencies such as the Japanese yen and the U.S. dollar are traditionally seen as safe havens compared with riskier investments, including the Taiwan dollar. Taiwan stocks <.TWII> rose 1.37 percent on Monday, but foreign funds sold a net T$2.392 billion ($70 million). Exporters also bought U.S. dollars for cash needs overseas, further pressuring the local currency, a dealer said. Some investors stayed on the sidelines waiting for more clarity ahead of Taiwan's first-quarter GDP data, which will be released on Thursday, some dealers said. "Trade was generally thin today, with some investors choosing to stay away until GDP is released," said another dealer. The Taiwan dollar slid earlier in the year due to the global economic downturn, but has climbed back in recent weeks on optimism about new trade and investment deals signed in April between the island and economic powerhouse China. In the non-deliverable forwards market, six-month NDFs were quoted at -0.590/-0.540, compared with Friday's -0.580/-0.530. That indicated the market was expecting the Taiwan dollar to strengthen by a slightly higher degree in half a year. On the smaller Cosmos exchange , the Taiwan dollar closed at T$32.985, weaker than Friday's close of T$32.909. (Reporting by Ralph Jennings; Editing by Chris Lewis) ((ralph.jennings@thomsonreuters.com; +886 2 2500 4882; Reuters Messaging: ralph.jennings.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)) Keywords: MARKETS TAIWAN CURRENCY/
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