Gold price firmer

Press, 11 February 1981, Page 23

Gold price firmer

PA New York Strikes in Poland, and renewed concern over the possibility of Russian intervention, helped to send the price of gold higher yesterday. Gold for delivery this month closed at $518.70 an ounce on the commodity exchange in New York, a gain of $14.20 from Friday. In later trading, Republic National Bank quoted a price of $517, up $l4 from Friday. “The news from Poland sounded pretty bad,” said one New York gold trader. He added that a number of traders covered their short positions, helping to push up the price. The dollar showed modest gains against Friday’s late New York rates. Worries over a possible Soviet intervention in Poland hurt the major European currencies, traders said. In addition, the

dollar was helped by the fact that interest rates in United States remained relatively stable, i Morgan Guaranty, the fifth largest United S'ates bank, led the way to a 19 per cent prime interest rate by lowering its charge to its best corporate customers by half of a percentage point. The action was expected to be followed shortly by other major banks, which were still holding to 19.5 per cent.

The move was caused in part by a drop in bank loan demand.