Special Talks May Aim to Drive Dollar Down : Top Financial Officials of U.S., Allies Expected to Unveil Plan to Boost International Economy

The U.S. government’s top two financial officials and their counterparts from four other major industrial nations have called a special meeting for today amid speculation that they are about to embark on a campaign to drive down the value of the dollar and ease the massive American trade deficit.

Treasury Secretary James A. Baker III and Federal Reserve Board Chairman Paul A. Volcker along with the finance ministers of Britain, France, West Germany and Japan are expected to unveil a program for strengthening the international economy during a time of rising protectionist sentiment.

The meeting, and a news conference at the Plaza Hotel in New York, were scheduled for today to avoid any sudden disturbance in the financial markets, which are closed on Sundays, a U.S. official said.

President Reagan, under growing pressure from Congress to restrict imports, insisted Saturday in his weekly radio address that he retains an “absolute commitment to trade that is both free and fair.” The President will deliver a major address on trade Monday in an effort to slow the political momentum of protectionist bills now racing through Congress.

Today’s meeting in New York, with the United States and its trading partners showing a united front, will give the President a powerful argument to use Monday when he addresses a group of business officials at the White House. His message will be aimed at a much wider audience, however, in an effort to reassure companies, workers and members of Congress who are increasingly agitated about the impact of imports on jobs and profits.

The President will be able to say that cooperation by the big trading nations will go a long way toward solving this nation’s deficit problem, according to one U.S. official, who requested anonymity.

Government sources emphasized that today’s meeting is not an emergency gathering and is not related to Mexico’s financial problems or its devastating earthquakes. The Treasury Department announced the meeting Saturday without offering further details. The participants meet at various international gatherings, but it is unusual for them to hold a news conference for public discussion of their decisions.

‘Coordinated Intervention’

“I would think the easiest thing for them to announce would be coordinated intervention,” action to drive down the value of the dollar in relation to other currencies, said Fred Bergsten, who served as under secretary of the Treasury for monetary affairs in the Jimmy Carter Administration. Governments could drive down the dollar by going into the financial markets and selling large amounts of the currency.

The dollar’s value in international markets has risen 38% in the past five years, making imports cheap for Americans, while driving up the price of U.S. exports for foreigners.

The U.S. trade deficit--the gap between what is imported and what is sold abroad--is expected to reach a record $150 billion this year, and the desire to stem the tide of imports has become the hottest issue in Washington.

The value of the dollar has been declining recently, and by moving soon to accelerate that trend, the United States and its industrial partners would be “leaning with the wind,” said Bergsten, who is director of the Institute for International Economics, a Washington organization. The Administration “is desperate to say something on the exchange rates which would ease some of the protectionist pressures,” said Lawrence Fox, vice president for international issues at the National Assn. of Manufacturers.

Free-Floating Rates

The financial leaders might agree today on a major review of the problems of free-floating exchange rates, Fox said. The current system, in which the dollar can move up and down without limit, has dealt a severe blow to American industry, he said.

The financial leaders meeting in New York also might be ready to announce additional funds for the World Bank, to help it ease the financial burden of Third World countries with heavy bank debts, Fox speculated.

Another possible subject for today’s meeting, according to economists, could be efforts by the United States to persuade Japan and West Germany to boost their economic activity, to take some of the burden off the United States as the engine of world business recovery. The United States may also be considering Japan’s offer to restrict the flow of capital into the United States, now running about $8 billion a month, Bergsten noted. The Japanese purchase of U.S. government securities and other investments is helping keep the dollar high in comparison with the yen.