Sing dollar is quoted around 1.6625 per US dollar, just 0.1 percent up from Thursday's levels. It has depreciated 1.9 percent this year. Taiwan dollar closes just off a 3-1/2-month high of 32.795 against US dollar as exporters dump dollar earnings before year-end. Foreign investors continue to buy local stocks, helping push the benchmark stock index to a 20-month high.
The Taiwan dollar rose on Friday to the highest level since mid-September as exporters and foreign funds actively unloaded US dollars on the last trading session before the new year, dealers said.
The Taiwan dollar ended firmer at T$32.850 to the US dollar, compared with Thursday's close of T$32.908, after rising to as high as T$32.795 during the session. Both the intra-day high and the closing level are the strongest since September 15.
Still, the Taiwan currency is down 2.8 percent in the year due to concern over the domestic economy and the widening interest rate gap with the United States.
Trading volumes on the Taipei Forex Inc exchange rose sharply to US $1.219 billion, the largest amount since August 30, compared with the previous session's US $1.039 billion.
Traders said the central bank also bought some US dollars to stop the Taiwan dollar from firming beyond T$33.0 on Thursday, but the amount of foreign fund buying was too large.
Foreign investors, who have been net buyers of Taiwan's stocks every trading session in December except December 9, purchased another net T$3.5 billion (US $107 million) on Friday.
But dealers said the US dollar was still on track to log its best annual gains against major currencies in eight years, supported by the Federal Reserve ongoing rate-rising campaign.
On the smaller Cosmos exchange the Taiwan dollar ended at T$32.843 to the US dollar from Thursday's finish of T$32.895. Thai baht weakens to a two-week low of 41.13 per dollar. Dealers in Bangkok say offshore investors only players in very thin trading as local banks stay away, exaggerating moves.
But Asian currencies set to end 2005 looking better than the yen, which is down nearly 13 percent this year. Baht, which usually tracks the yen closely, has weakened only 5.4 percent and the Taiwan dollar has shed 2.7 percent.
Markets in South Korea, the Philippines and Indonesia were closed on Friday.