The Taiwan dollar strengthened 1.2 cents against the U.S. dollar on Thursday to close at NT$31.925, supported by the U.S. Treasury Department’s plan to at least double buybacks of 10- to 30-year Treasury bonds, lower U.S. yields and modest net buying by foreign investors in Taiwan equities. The currency traded between NT$31.840 and NT$31.997, with volume of $1.752 billion, or about NT$56 billion. Taiwan’s benchmark index rose 0.48%, while foreign investors bought NT$3.78 billion of listed shares. The US Dollar Index fell to around 98.9, its lowest level since mid-May, as markets viewed the buyback plan as a signal that officials intend to stabilize the long end of the yield curve. FX expert Li Qizhan expects the Taiwan dollar to consolidate between NT$31.7 and NT$32.0 in the near term, near the upper end of the range, while warning that a collapse in U.S.-Iran ceasefire talks could trigger a safe-haven sell-off and renewed depreciation pressure. Citigroup strategists including Dirk Willer said the plan’s main cost could be currency weakness and said the bank would shift the funding currency for emerging-market carry trades to the U.S. dollar. Investors are also watching foreign flows, geopolitical developments and the Federal Reserve’s July meeting minutes for signs of a hawkish policy tilt.