Dollar Drops; Gold Is Higher

The U.S. dollar backed off Tuesday against all key currencies except the Canadian dollar in quiet, technical trading in Europe. Gold prices moved higher.

Foreign exchange dealers said the dollar’s advance to two-month highs on Friday and Monday was interrupted by profit-taking while the market awaited statistical indicators of U.S. economic strength to be released later this week.

In Tokyo, the dollar Tuesday closed at 243.00 Japanese yen, up from Monday’s 242.95 yen. Later in London, it fell back to 242.82 yen.

In London, the dollar dipped against the British pound after four market days of strong gains. It cost $1.3150 to buy one pound sterling, more expensive than $1.30625 on Monday.

Other late dollar rates, compared to Monday, were: 2.9420 West German marks, down from 2.9450; 2.42625 Swiss francs, down from 2.4290; 8.9650 French francs, down from 9.0545; 3.3020 Dutch guilders, down from 3.3040; 1,956.00 Italian lire, down from 1,957.75, and 1.37195 Canadian dollars, up from 1.37105.

Gold prices firmed in thin trading, partly spurred by the dollar’s weakness, bullion dealers said.

In London, the metal rose to a late bid price of $321.75 an ounce, up from $320.50 on Monday.

In Zurich, it rose to $322.50 bid, up from $320.00 on Monday.

Silver bullion prices fell in London to a late bid price of $6.05 an ounce, down from $6.11 bid on Monday.