Foreign Exchange : Central Banks Intervene in Europe
Central banks of several European Monetary System countries intervened in foreign markets to support their currencies against the strong West German mark on Wednesday. But officials in Bonn said the mark did not need to be revalued. The dollar was mostly higher.
Gold prices were down in Europe, but closed higher in U.S. trading later in the day.
Republic National Bank in New York quoted a bid for gold at $401.85 an ounce. That was up from Tuesday’s bid of $399.25.
Trading was hectic on European foreign exchanges as the central banks bought and sold various currencies to defend their own against the mark.
The mark sold in Milan at a record 699.70 Italian lire and the Dutch guilder also reached a new high against the lira.
Meanwhile, industrial unrest in France continued to weaken the franc. The dollar rose to 6.4225 French francs in European trading, from 6.4050 on Tuesday.
In later New York trading, the dollar closed at 6.4265 francs, up from 6.3875.
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