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17:04 29Jul09 RTRS-Taiwan dollar weakens on funds, exporters support * Taiwan dollar weakens on foreign fund outflows * Investors avoid risk ahead of U.S. GDP on Friday * Trade seen mainly between T$32.8 and T$33.0 for the week * Offshore NDFs narrow (Adds details, quotes) TAIPEI, July 29 (Reuters) - The Taiwan dollar fell on Wednesday, retreating from a 1-½ month closing high in the previous session, due to foreign fund outflows as local stocks fell, but exporters capped the losses. The Taiwan dollar had firmed on Monday and Tuesday, ending at its strongest level since June 10. "Local stocks and other markets in Asia staged a pull-back after the recent rally," said a dealer in Taipei. "Investor risk appetites also waned as they anxiously await GDP (gross domestic product) data from the U.S. on Friday." Taiwan stocks <.TWII> fell 0.83 percent as investors locked in profits in major technology shares after their recent rally. Investors often sell off Asian currencies to avoid risk as the region's export-reliant economies trade heavily with the United States. "The central bank also bought U.S. dollars during the session, further pressuring the local currency," said the dealer. However, U.S. dollar selling by exporters helped contain the decline. Exporters took advantage of the weak currency to change into more Taiwan dollars to meet cash needs at home. Dealers said they expected the Taiwan dollar to remain rangebound on Thursday and Friday, trading mainly between T$32.8 and T$33.0. In the non-deliverable forwards (NDFs) market, six-month NDFs narrowed, indicating that the market is expecting the Taiwan dollar to strengthen less than earlier predictions. 0800 GMT PREVIOUS SESSION T$ (Taipei Forex Inc) 32.871 32.743 Volume in $ mln (Taipei Forex Inc) 1,228 1,021 T$ (Cosmos) 32.840 32.725 Six-month NDFs -0.460/-0.440 -0.570/-0.550 Note: Taipei Forex Inc is Taiwan's main forex exchange; Cosmos is a smaller exchange. Both markets close at 0800 GMT. Source: NDFs quotations from Prebon Asia For more foreign exchange news, please click (Reporting by Lin Miao-jung and Joan Hsu; editing by Chris Lewis) ((gina.chang@thomsonreuters.com; +886 2 2508-0815; Reuters Messaging: gina.chang.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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