Currency report

Press, 18 June 1979, Page 20

Currency report

Sterling firmed sharplv on the British Budget measures, and closed at its highest levels 1 for more than three years-’ on a trade-weighted baste, according to the weekly foreign exchange report from the Bank of New South Wales. The Bank of England appeared to have intervened in the market from time to time, at various levels, in am attempt to smooth sterling's rise. The announcement of a rise in the minimum lending rate to 14 per cent, from 12 per cent previously, produced the main surge in the sterling rate. The attractiveness of the British interest rate was further illustrated by the rapidity with which the U.K. Government's tap stock was exhausted, with the help of foreign interest. The United States dollars traded relatively quietly against other currencies, weakening slightly after the cut in the prime rate to 11.5 percent, from 11.75 percent, by Morgan Guaranty Trust Company. In the European monetary system the Danish crown was at the bottom of the system and 4.63 per cent weaker than the strongest EMS currency, the lira.