Dollar Retreats Broadly in Europe; Gold Edges Up

The dollar staged a broadly based retreat in Europe early today. Gold bullion edged higher.

Traders attributed the dollar’s decline to profit-taking following the currency’s surge in New York late Tuesday.

Positive U.S. economic news and a rise in long-term U.S. interest rates had helped lift the dollar Tuesday from two-year lows reached Monday.

Many Investors Wait

A trader in Frankfurt, West Germany, said many investors were staying out of the market today because of the dollar’s big swings of the previous two days. Consequently, the currency was fluctuating within a narrow range during the first few hours of trading.

Selected mid-morning dollar rates, compared to rates in Europe late Tuesday, were: 2.5220 West German marks, down from 2.5300; 2.1025 Swiss francs, down from 2.1115; 7.69 French francs, down from 7.7225; 2.835 Dutch guilders, down from 2.8495; 1,715.50 Italian lire, down from 1,725.50, and 1.39 Canadian dollars, down from 1.3914.

The British pound rose to $1.4857 from $1.483.

Fighting its weaker trend in Europe, the dollar rose for a fifth consecutive session in Tokyo, closing at 204.15 Japanese yen, up from 203.90 yen Tuesday.

Later in London, the dollar was quoted at 203.125 yen.

London’s five main bullion houses fixed a recommended gold price of $324.50 an ounce, up from $322.30 late Tuesday.

In Zurich, gold was bid at $324.40, up from $322.50.

Earlier in Hong Kong, the metal closed at a bid of $325.32, up from $323.98.

Silver was quoted in London at a bid of $6.10 an ounce, unchanged from late Tuesday.