Foreign Exchange for Friday, Sept. 20, 1985 : Dollar Falls in Reaction to GNP Report

The dollar fell sharply and broadly Friday against major foreign currencies following the release of U.S. economic growth figures that dealers called disappointing. Trading was hectic.

Gold prices were mixed. Bullion was quoted at $319 an ounce in late trading at Republic National Bank, down $1 from Thursday’s late bid.

“We had pretty much of a free-fall all day,” said James McGroarty, a vice president with Discount Corp.

Jack Barbanel, director of futures trading at Gruntal & Co. said: “The key factor here is a growing lack of confidence by foreign traders that the U.S. economy is going to turn around. It’s beginning to look quite apparent that the White House overestimated the rebound in the economy.”

Foreign traders, who had stayed on the sidelines this week while they awaited the GNP report, jumped in on Friday to buy the British pound, Barbanel said.