CURRENCY REPORT

Press, Volume CXIV, Issue 33706, 2 December 1974, Page 23

CURRENCY REPORT

Trading on foreign exchange markets is j continuing in the same unsettled mood of recent weeks — with several factors contributing to the disorderly conditions, says the Bank of New South Wales in its weekly foreign exchange report.

The further weakening of sterling which early in the week reached a record trade- ! weighted depreciation since (the Smithsonian agreement [of 20.8 per cent; the favourable United States trade figures for October, which ■ showed the first trade surplus (in six months coupled with skepticism about the effectiveness of President Ford’s (economic policies; speculation on the possibility of a revaluation of the German mark after Chancellor I Schmidt’s statement that, he I was not averse to revaluation ( —which t,ook the DM to the [top of the joint float and (breached the maximum ■ spread permitted under joint 'float rules; the Swiss (measures to stem capital inilflow by the imposition of a [negative interest rate on non [resident deposits and limitations on the forward sales of Swiss francs to (foreigners: all appear to (evidence that there is no agreement between Central banks to intervene in the markets on a concerted basis to encourage orderly trading. It would seem, therefore, . that the outlook for the foreseeable future is for a continuation of erratic conditions, with sudden and un- ■ predictable currency trends. On Pacific exchanges the major point of interest was the floating of the Hong Kong dollar against the U.S. dollar. The Hong Kong Government said it had been intervening on a substantial scale t.o support the dollar which had ; suffered heavy selling over the past weeks. Tn Tokyo the United States dollar has been (steady at about yen 300. Gold prices have steadied

■ and most dealers say the (price appears to have consolidated in the $lB5 area in (the short term. Latest interest rates offered ; for Euro-currencies were: j 1 month: SUS9S. DmB3 4. ;Swfcs7. Stgl4-U/16. ; 3 months: SUSIOg, Dm9. |SwfCs9g. Sig 16-3/16. 6 months: SUSIO£, Dm9. S\vfcs9i. Stgl6j(. 1 year: SUSP,;. DmB;, iStglsA. 2 years: SUSIOi, N/A, X/A. !N/A. 3 years: St’SlO,, X/A, X/A. !* 5 ‘vears: SUSIO4 X/A, X/A, :N7A.