Employment Data Due

USD/TWD dropped for the third straight session yesterday, closing at 28.172 – the rate touched 27.95 during the session, the lowest this week, but still couldn't manage a close below the 28.00 handle amid speculation of central bank intervention on the close.

• The Taiex had another barnstorming session yesterday, rising 2.2% as markets digested strong export order data. The index closed above 16,000 for the first time ever. Foreign flows have helped the index take the key level, in the past two weeks foreigners have been net sellers to the tune of TWD 17.9bn, but saw a massive swing towards buying yesterday.
• Elsewhere, Taiwan will punish foreign banks after 8 foreign grain firms engaged in FX speculation by deliverable forwards trading totaling $11b. The banks' FX business license could be revoked as they violated the principle that forwards trading must be based on real needs, and failed to verify documents.
• Regionally market participants will look ahead to unemployment data at 0800GMT/1600HKT.