$U.S. still stable

Press, 21 April 1984, Page 21

$U.S. still stable

The United States dollar remained very stable this week with trading ranges against most currencies relatively narrow, according to the Westpac Banking Corporation’s weekly foreign exchange report. Sentiment for the dollar’s future direction still remains mixed, the report says. “Many operators expect a lower dollar longer term, however, the United States currency has remained firm despite last week’s economic data which indicated a slowing economy.”

The Deutschmark suffered this week in light of growing industrial unrest in West Germany, but the level of DMK 2.6390 - 2.6425 met with substantial resistance and many operators found this level attractive at which to buy. Sterling is also said to have suffered from the British miners’ strike and a soft undertone is expected to remain on this currency. The Japanese yen weakened from its firmer levels of 223.00 last week, mainly on profit-taking and import buying, but it continued as one of the strongest currencies outside the United States dollar, and this trend is expected to continue. The Australian dollar was

somewhat volatile this week with corporate interest around the week’s lows of 0.9145 halting any further downward move.

“We expect some volatility to remain with Australian dollar short-term interest rates dictating interbank trading. The expected range for next week is 0.9150 - 0.9300,” the Westpac report says. The Press Association reports that the dollar moved higher on Thursday in light trading in the United States after turning in a mixed performance in Europe, amid signs of stronger-than-expected U.S. economic growth. Dealers in the United States and Europe said trading was light in advance of the Easter holiday weekend.

One trader said the dollar rose in U.S. trading after the Government announced an annual rate of Gross National Product increase of 8.3 per cent between January and March. Most traders had expected only a 7.2 per cent. rise and the actual figure raised concern that U.S. interest rates could be headed higher, increasing returns on dollardenominated investments. The Federal Reserve Board’s report late on Thursday of a SUS 3 billion

rise in the Ml in the week to April 9 caused little reaction as the rise apparently fell within expectations.

One trader said there were rumours that the West German central bank had intervened • by selling dollars, helping check the dollar’s rise against the mark.

In New York, the dollar rose to 225.08 Japanese yen from 224.58 yen late on Wednesday. The British pound sterling fell to 1.4169 dollars from 1.4208. The Australian dollar closed firmer on Thursday on booksquaring in the afternoon ahead of the Easter holiday break, dealers in Sydney said.

The Australian unit closed firmer at 92.30/35 U.S. cents after its opening of 92.15/22 U.S. cents, but little changed from Wednesday’s last of 92.30/37 U.S. cents. The unit also was firmer against the other major currencies, finishing at 0.6511 sterling from 0.6485, rising to 2.4478 marks from 2.4316 and showing gains to 207.49 yen compared with 206.84 the day before.

On the Sydney Futures Exchange the U.S. dollar closed easier with June contracts ending the day at 108.80 cents compared with 108.88 cents on Wednesday.