Foreign Exchange for Tuesday, Nov. 4, 1986 : Dollar Hits 4-Month High Against Yen

The dollar rose to a four-month high in Japan on Tuesday, but it later turned mixed in a narrow range against other major foreign currencies amid uncertainty over the outcome of U.S. congressional elections in quiet trading.

Gold prices rose. Bullion was quoted at $408.75 an ounce at Republic National Bank, up $3.75 from Monday’s bid.

Dealers in Frankfurt said they were awaiting the results of the mid-term vote before taking firm positions on the dollar.

A substantial win by the Democrats could force the dollar lower, they added, especially if the Democrats took over the Senate.

The fear is that Democrats would seek to increase federal spending, worsening the nation’s budget deficit, and would press for protectionist trade measures.

Jim McGroarty, vice president of Discount Corp. said: “I think the European markets more than our markets here are waiting for the Congressional elections. They have been much more sensitive in looking at that.”