The dollar fell sharply, hitting a post-World War II low against the Japanese yen and a five-year low against the West German mark, despite efforts to support the U.S. currency by the central banks of West Germany and Japan.
Currency dealers attributed the dollar’s decline to the perception that the U.S. economy remains weak and the belief that the Reagan Administration wants the dollar to continue dropping in value.
President Reagan is expected to express that view when he meets leaders of other industrialized nations at the Tokyo summit May 4. Lower-valued dollars make U.S. exports cheaper and would help ease the trade deficit, which totaled a record $148.5 billion last year.
Dealers said the dollar rallied in early U.S. trading after West Germany’s central bank, the Bundesbank, and the Bank of Japan intervened in the market by buying dollars. But as trading-progressed the dollar’s decline resumed, though it still closed slightly higher against the mark in New York.