Currency report

Press, 27 August 1979, Page 20

Currency report

Tfie United States dollar firmed last week, according to the weekly foreign exchange report from the Bank of New South Wales. This was partly in reaction ta the increase in the U.S. discount rate to a record 10.5 per cent, and partly in response to the news that President Carter moved to decontrol heavy oil prices. The dollars’ upward movement appeared to be limited, not only by prospects of a rise in the U.S. consumer price index for July — figures which are due to be announced on Friday 24 — but also by the action of the European central banks; these were apparently selling dollars to counteract the effects of recent dollar support on European money markets. Sterling held steady in a quiet market. News that the U.K’s, visible trade figure was in rough balance in July prompted the market to mark up sterling slightly. The Canadian dollar closed marginally weaker in reaction to the statement by the Finance Minister (Mr Crosbie) that he hopes the Bank of Canada will be able to resist pressure to raise its lending rate in line with the recent increase in the U.S. discount rate. A sharply wider Japanese customs clearance deficit for the first 10 days of August, of 5778.5 M, lent a softer tone to the ven. I