Gain in Housings Starts Boosts Dollar

The dollar edged higher Wednesday in foreign exchange trading as the government reported a brisk gain in U.S. housing starts last month.

Gold prices fell. In after-hours trading, Republic National Bank in New York quoted a late bid for gold at $314.75 an ounce, down from $316.50 an ounce late Tuesday.

Foreign exchange dealers in Europe said the dollar rose sharply in early trading following the report that housing starts were up 6.2% in August.

But they said the dollar later lost some of its gains as traders looked toward Friday’s release of the government’s first estimate of third-quarter economic growth in the United States.

James T. McGroarty, vice president at the government securities dealer Discount Corp., said trading in New York was dominated by professionals and was “thin and nervous in advance of these statistics.”

He said the housing-starts figures had been widely anticipated here, and the report had little effect on U.S. trading.