Accra:The U.S. dollar climbed significantly against the Taiwan dollar on Tuesday, closing above NT$32 for the first time in two months. This increase came as investors sought refuge in the greenback due to rising geopolitical tensions, as per market dealers.

According to Focus Taiwan, the U.S. dollar fluctuated between NT$31.951 and NT$32.237 before gaining NT$0.190, or 0.59 percent, to close at NT$32.085. This marks the first time the currency closed above NT$32 since August 14, when it ended at NT$32.046.

The greenback was bolstered early in the trading session following reports of another Houthi attack on Saudi Arabian airports, which led to a surge in international crude oil prices. This spike in oil prices triggered inflationary fears, leading investors to anticipate a more aggressive monetary policy stance from the U.S. Federal Reserve, which could further strengthen the U.S. dollar.

The local stock market also experienced a downturn, with foreign institutional investors selling off shares, adding pressure on the Taiwan dollar and aiding the U.S. dollar's rise. The Taiex, Taiwan Stock Exchange's benchmark index, fell sharply by 960.65 points, or 1.95 percent, to 48,341.31. This drop was driven by significant sell-offs in semiconductor stocks after similar losses in the U.S. market, with foreign investors selling a net NT$165.34 billion in shares, marking the third-largest net sell-off recorded.

Investors are now looking ahead to the upcoming U.S. consumer price index report for September, set to release on Wednesday (U.S. time), which could provide further insights into the Federal Reserve's potential actions.