$US upset by rumour

Press, Volume CXV, Issue 33775, 22 February 1975, Page 13

$US upset by rumour

(N.Z. P.A. -Reuter —Copyriohtl

LONDON.

The United States dollar and the pound sterling fell on foreign exchange markets on Thursday; the dollar suffered from rumours that members of the Organisation of Petroleum Exporting Countries would press for oil payments to be made in other currencies.

But in Vienna, informed O.P.E.C. sources said that ministers jf the organisation were unlikely to take any immediate action to bypass the dollar. Dealers said that the rumours appeared to follow Venezuela’s move earlier this week to diversify from dollars by buying West German marks and Dutch Guilders. The O.P.E.C. scare was not the only adverse factor for the dollar. Iran’s decision to cut the United States currency’s value against the rial added to market nervousness.

In New York, where the dollar weakened in spite of reported support by the Federal Reserve Board, dealers said that Iran’s action would make Iranian crude oil more expensive. There was continued speculation that other oil producers might follow Iran's decision to link its currency to the International Monetary Fund’s special drawing rights rather than the dollar. The United States domestic economic problems con-

tinued to plague the dollar in Europe.

London dealers said that one depressing factor for the American currency was the growing confrontation between the Administration and Congress on President Ford’s programme of oil-im-port fees. The dollar dropped to 2.3020-60 marks from 2.32803300 overnight. It retreated to 2.4450-4500 Swiss francs from 2.4800-20, and to from 2.3990-4015. The dollar was quoted at 4.2435-80 French francs, compared with 4.2780-2810 previously, and it also declined against all the Scandinavian currencies. The pound sterling also had a bad day against major currencies apart from the dollar, but in dollar terms the pound improved to 2.4005-15 from an opening price of 2.3970-80. Sterling’s effective depreciation rate against other major currencies, compared with levels three years ago, was 21.8 per cent at the close, against an overnight 21.5 per cent.