Dollar resuscitated after record dive

Press, 17 August 1978, Page 13

Dollar resuscitated after record dive

NZPA London! The dollar on Tuesday, night staged a substantial if modest recovery against the main currencies, after once again falling to new record lows against the Japanese yen, the Swiss franc and the West German mark earlier in the day. Some London dealers said dollar purchases by European central banks had stopped the dollar’s slide, which had become dramatic in a few days. The Bundesbank was reported to have stepped in to the market in Frankfurt on Tuesday when the dollar made history by falling below the 1.92-mark level for the first time. However, dealers estimated that the bank, the West German Central Bank, bought only a small amount of dollars. The dollar closed at 1.9535

marks in London — well up on the day, but still far below last week. The effect of the dollar’s recovery on gold was enormous. After trading at a recorded $216.38 an ounce on the London bullion market in the morning, it fell to $213.05 at the close — down on Monday’s closing price. The dollar’s strengthening meant that sterling was unable to hold on to its early morning gains. The pound briefly rose above the $2 for the ~ first time since March, 1976, but closed much lower at 1.9735 — 78 points down on the day before. The dollar fell to an alltime low of 181.80 yen in Tokyo, but by the end of trading in London it had climbed back to 184.25 yen. It opened again at 184 yen in Tokyo yesterday.