The dollar traded mainly higher on Friday as better-than-expected US data helped shift expectations on healthy growth going forward in the world's biggest economy.
However, the greenback lost ground against the New Taiwan dollar on the Taipei Foreign Exchange on Friday, decreasing NT$0.01 to close at NT$33.009.
A total of US$1.4 billion changed hands during the day's trading.
The US currency opened higher at NT$32.917, and fluctuated between NT$32.917 and NT$33.107.
The euro slipped to US$1.3442 at 9pm GMT from US$1.3454 in New York late on Thursday, after earlier in the day slipping below the US$1.34 mark for the first time in almost two months.
The US dollar rose to ?122.09 -- hitting its highest level since late January -- from ?121.71 on Thursday.
The US currency picked up momentum after data showed the US economy added a net 157,000 jobs last month, better than expected. Analysts said the report suggests the economy is coming out of its first-quarter soft patch but that inflation remains only moderate.
The payrolls are a key event for the market, which is anxious for fresh clues on the outlook for US interest rates.
The Federal Reserve has been on hold for nearly a year with base US rates at 5.25 percent. In recent months, market participants have shifted away from a perception that the Fed will need to cut rates to stimulate flagging growth.
Stephen Gallagher, economist at Societe Generale, said he has now thrown in the towel on his forecast for a Fed rate cut this year, and now sees the next move by the US central bank as a rate hike.
"More and more we are convinced the mid-cycle slowdown has ended and the economy is currently firming to trend," Gallagher said. "Against a backdrop of stubborn inflation and tight labor markets, our analysis going forward will be more focused on the timing of rate hikes, not cuts."
Meanwhile, the closely watched US ISM survey on manufacturing activity came in above forecasts, rising to 55.0 last month from 54.7 in April to reach its highest level for 12 months.
Analysts said the good news on the US economy was enough to offset evidence of moderating inflation, with the annual core PCE indicator -- the Federal Reserve's preferred measure of inflation -- dropping to a 13-month low of 2 percent, according to a US Commerce Department report.
The report also showed US consumer income down 0.1 percent in April, while spending rose 0.5 percent.
While the data as a whole shored up the dollar, there was some skepticism about the perceived improvement in the figures.
"The strength in May payrolls has largely emerged from services jobs, the durability of which remains doubtful," Ashraf Laidi at CMC Markets said.
Against this backdrop, the outlook for US interest rates is still cloudy, he noted.
Michael Woolfolk at Bank of New York said the easing inflation indicators suggest the Fed will be in no hurry to hike rates, and this limited the dollar's rally. But he said the greenback is keeping upward momentum.
"The real surprise in this morning's price action was not the relatively modest reaction to nonfarm payrolls and personal income and spending, but rather the positive dollar tone," he said.
"A ubiquitous sense of economic recovery pervades the market right now, which is unequivocally positive for the dollar. ... While players are having difficulty breaking below the 1.3400 level in the euro-dollar, further signs of the US economic rebound should make this a fait accompli by next week," Woolfolk said.
Next week's market focus is on Thursday's meeting of the European Central Bank in which the bank is seen as almost certain to raise its key interest rates to a five-and-a-half-year high to curb inflation in the 13-nation eurozone economy.
In late New York trading, the US dollar stood at 1.2209 Swiss francs from SF1.2250 on Thursday.
The pound was being traded at US$1.9819 after US$1.98.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) would not produce its most advanced technologies in the US next year, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the comment during an appearance at the legislature, hours after the chipmaker announced that it would invest an additional US$100 billion to expand its manufacturing operations in the US. Asked by Taiwan People’s Party Legislator-at-large Chang Chi-kai (張啟楷) if TSMC would allow its most advanced technologies, the yet-to-be-released 2-nanometer and 1.6-nanometer processes, to go to the US in the near term, Kuo denied it. TSMC recently opened its first US factory, which produces 4-nanometer
PROTECTION: The investigation, which takes aim at exporters such as Canada, Germany and Brazil, came days after Trump unveiled tariff hikes on steel and aluminum products US President Donald Trump on Saturday ordered a probe into potential tariffs on lumber imports — a move threatening to stoke trade tensions — while also pushing for a domestic supply boost. Trump signed an executive order instructing US Secretary of Commerce Howard Lutnick to begin an investigation “to determine the effects on the national security of imports of timber, lumber and their derivative products.” The study might result in new tariffs being imposed, which would pile on top of existing levies. The investigation takes aim at exporters like Canada, Germany and Brazil, with White House officials earlier accusing these economies of
GREAT SUCCESS: Republican Senator Todd Young expressed surprise at Trump’s comments and said he expects the administration to keep the program running US lawmakers who helped secure billions of dollars in subsidies for domestic semiconductor manufacturing rejected US President Donald Trump’s call to revoke the 2022 CHIPS and Science Act, signaling that any repeal effort in the US Congress would fall short. US Senate Minority Leader Chuck Schumer, who negotiated the law, on Wednesday said that Trump’s demand would fail, while a top Republican proponent, US Senator Todd Young, expressed surprise at the president’s comments and said he expects the administration to keep the program running. The CHIPS Act is “essential for America leading the world in tech, leading the world in AI [artificial
REACTIONS: While most analysts were positive about TSMC’s investment, one said the US expansion could disrupt the company’s supply-demand balance Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) new US$100 billion investment in the US would exert a positive effect on the chipmaker’s revenue in the medium term on the back of booming artificial intelligence (AI) chip demand from US chip designers, an International Data Corp (IDC) analyst said yesterday. “This is good for TSMC in terms of business expansion, as its major clients for advanced chips are US chip designers,” IDC senior semiconductor research manager Galen Zeng (曾冠瑋) said by telephone yesterday. “Besides, those US companies all consider supply chain resilience a business imperative,” Zeng said. That meant local supply would
RSS