CURRENCY : Dollar’s Rally Cut Short; Price of Gold Rises in N.Y.
The dollar finished lower Wednesday against most major currencies except the Canadian dollar as a rally inspired by a positive U.S. trade performance ran out of steam.
Gold prices rose in New York after closing mixed overseas. Republic National Bank of New York quoted a bid of $455.50 for an ounce of gold at 4 p.m. EDT, up from $453.75 late Tuesday.
The dollar rode a wave of bullishness after the Commerce Department reported Tuesday that the trade deficit fell to $9.75 billion in March from $13.83 billion in February. The rally spilled over into Asian and European trading Wednesday, but fizzled in later dealings in New York.
Traders said the dollar’s advance was halted mainly by a lack of momentum and by technical market factors. The modest recovery in gold prices also contributed to the dollar’s decline, they said.
“People thought the dollar had been overbought,” said Dan Holland, a vice president of Discount Corp. in New York.
In Tokyo, the dollar rose to 125.53 Japanese yen from 124.82 yen late Tuesday. In later London trading, it retreated to 125.33 yen. By the end of the trading day in New York, the dollar settled at 124.93 yen, down from 125.75 yen late Tuesday.
The British pound declined in London to $1.8605 from $1.8630. Sterling recovered later in New York, rising to $1.8675 from $1.8603 late Tuesday.
Other late dollar rates in New York, compared to Tuesday’s late rates, included: 1.7007 West German marks, down from 1.7065; 1.4182 Swiss francs, down from 1.4233; 5.7575 French francs, down from 5.7795; 1,263.50 Italian lire, down from 1,267.00, and 1.2463 Canadian dollars, up from 1.2370.
Other late dollar rates in Europe, compared to Tuesday’s late rates, included: 1.7055 West German marks, up from 1.7045; 1.4215 Swiss francs, up from 1.4190; 5.7700 French francs, down from 5.7710; 1.9090 Dutch guilders, up from 1.9060; 1,265.50 Italian lire, up from 1,264.00, and 1.24125 Canadian dollars, up from 1.2358.
The bid price for gold was $453.70 an ounce in London late Wednesday, up slightly from $453.50 bid late Tuesday.
In Zurich, Switzerland, the late bid price was $454, down from $455.
Earlier, in Hong Kong, gold fell to a closing bid of $454.54 from $454.67.
On the Commodity Exchange in New York, gold for current delivery settled at $457.30 an ounce, up from $455.50 late Tuesday.
Silver traded in London at a bid price of $6.58 an ounce, down 1 cent.
On New York’s Comex, silver for current delivery settled at $6.685 an ounce, up from $6.540 late Tuesday.
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