Dollar Rebounds as Gold Prices Fall

Associated Press

The dollar rose Thursday despite small-scale central bank intervention, rebounding from its massive fall of the previous day.

Gold prices fell. Bullion was bid at $287.25 an ounce in late trading at Republic National Bank in New York, down $1 from the late bid Wednesday.

Currency dealers said the dollar dipped in thin but nervous European trading when West Germany's Deutsche Bundesbank sold $70 million at the midday fixing in Frankfurt and then another $100 million on the open market in the afternoon.

But the U.S. currency rose after traders realized the action was not a repeat of Wednesday's concerted intervention in which European central banks sold at least $1.5 billion to curb the dollar's rise.

There was also talk that the Federal Reserve was selling dollars on a very small scale -- maybe a total of $30 million -- but that was viewed by traders as token intervention, said Gary Dorsch, a currency analyst with Oppenheimer Rouse Futures Inc. in Chicago.

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