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CURRENCY : Dollar Bounces Back in U.S.

February 19, 1988|Associated Press

NEW YORK — The dollar staged an unusual turnaround Thursday, closing mostly lower in Europe but rising domestically on technical factors and President Reagan's statement that he wants to rescue a kidnap victim in Lebanon.

Gold prices were mostly lower. Republic National Bank of New York reported a late bid for gold of $442.80 an ounce, down from Wednesday's late bid of $446.

In European trading, the dollar finished lower against all major currencies except the Canadian dollar, with little news to affect trading.

Traders sold dollars in anticipation that the U.S. currency would fall through certain technical levels. But when the dollar failed to cross those points, dealers had to buy back dollars to cover their positions, pushing the currency higher in U.S. activity, traders said.

Separately, traders said Reagan's statement that he wants to rescue Marine Lt. Col. William R. Higgins, who was kidnapped in Lebanon, sparked sudden interest in the dollar.

"The prospects of the U.S. going in with forces to get the colonel out of Lebanon adds fuel to the fire, because, in the case of war breaking out, the dollar is a safe haven," said Joseph Cally, a trader at Prudential-Bache Securities.

Earlier, in Tokyo, the dollar closed at 130 Japanese yen, down from 130.41. In London late Thursday, the dollar traded lower at 129.72 yen. Later in New York, the dollar rose to 130.375 yen from 130.125 yen Wednesday.

In London, one British pound cost $1.7508 late Thursday, more expensive for buyers than Wednesday's late $1.7490. In New York, it cost $1.74175 to buy one pound, cheaper than Wednesday' $1.75415.

Other late dollar rates in New York, compared to Wednesday's late rates, included: 1.71225 West German marks, up from 1.7010; 1.40965 Swiss francs, up from 1.3995; 5.7870 French francs, up from 5.7395; 1,261.00 Italian lire, up from 1,253.50, and 1.27055 Canadian dollars, up from 1.2673.

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