Dollar Declines in Light Trading; Gold Advances

The U.S. dollar fell Monday against all key currencies in thin European trading. Gold bullion rose in Zurich.

Foreign exchange dealers said the end of month trading was subdued partly because of a bank holiday in Britain, which closed financial institutions in London, and the Liberation Day holiday in Hong Kong.

Fears that central banks might intervene to support the dollar, which happened last week, also contributed to the inactivity, dealers said. There were no signs of intervention Monday.

Dealers said the dollar is not likely to move much before today’s scheduled release of the U.S. index of leading economic indicators for July. Dealers forecast that the index would show a 0.5% rise during the month.

In Tokyo, the dollar rose to a closing 142.35 Japanese yen from Friday’s three-month low of 141.50 yen. Later, in Europe, it fell to 141.90 yen.

Other late dollar rates in Europe, compared to late Friday: 1.8110 West German marks, down from 1.8145; 1.4925 Swiss francs, down from 1.4955; 6.0535 French francs, down from 6.0575; 2.0395 Dutch guilders, down from 2.0445; 1,311.25 Italian lire, down from 1,313.25, and 1.3189 Canadian dollars, down from 1.3194.

The British pound rose in European trading to $1.6340 from $1.6300 in London late Friday.

Gold prices rose in Zurich but trading was blunted by the public holidays in Britain and Hong Kong, bullion dealers said.

In Zurich, gold gained to a late bid price of $456 an ounce from $453.50 late Friday.