The Taiwan dollar rose to its strongest level in nearly a month as softer U.S. inflation data reduced expectations for a Federal Reserve rate increase in September and encouraged capital to flow back into Asian markets. The currency briefly broke through 32.2 against the U.S. dollar, touching 32.161 in early Wednesday trading, its strongest since July 17, before standing at 32.167 at midday, up 7.9 cents, with turnover at Taipei Forex Inc. reaching US$892 million, or about NT$29 billion. The move came as U.S. July CPI and PPI data pointed to easing price pressures, pushing the implied probability of a September Fed hike in rate futures to about 35%, down from 55% a week earlier, while the CME FedWatch Tool showed more than 60% odds of rates being held steady. The dollar index continued to swing around the 100 level, while traders said sustained foreign inflows into Taiwan equities were also supporting the local currency. Analysts said the Fed is likely to remain data-dependent, with oil prices, Middle East developments and the durability of equity inflows into Taiwan likely to shape the next move in the dollar and the Taiwan dollar.