CURRENCY : Dollar’s Retreat Unabated; Gold Prices Decline

The dollar fell in choppy trading Thursday as dealers continued to focus on the nation’s looming trade and budget deficits.

Gold prices also fell. Republic National Bank of New York quoted a late bid of $418.20 an ounce, down from $422.50 late Wednesday.

After plunging Wednesday, the dollar continued to recede as the presidential election faded into a non-event for currency dealers.

“There’s nothing to say,” said Robert Ryan, senior trader at Irving Trust Co. “The market realizes we still have the same problems,” a reference to the twin deficits.

Seeking Support

Ryan said there was virtually no reaction to statements by Japanese and British officials that there won’t be a meeting of the Group of Seven major industrialized nations before their already scheduled meeting in April. The G-7 finance ministers have worked to promote exchange rate stability.

Despite its drop, the dollar held to a fairly narrow range in worldwide trading amid fear of central bank intervention and the feeling among some dealers that the U.S. currency might be due for a technical bounce higher.

“The dollar still looks reasonably soggy, but I’m wondering whether it will kick back up at some point,” said Steve Grossman, a corporate dealer at Bank of America in London.

Comments by the Bank of Japan that it would consider seeking help from the European central banks to support the dollar gave the currency “a little lift,” said Lou Calvello, a trader at Prudential-Bache Securities Inc.

“But it drifted off again shortly after those statements,” he said. “A lot of people are still bearish on the dollar.”

Dealers said market attention was turning toward the next set of U.S. trade figures, due Wednesday.

In Tokyo, the dollar fell 0.55 yen to a closing 124.10 yen. Later in London, it was quoted lower at 123.90 yen. In New York, the dollar finished at 124.05 yen, unchanged from Wednesday.

In London, the dollar fell against the British pound. It cost $1.7970 to buy one pound, compared to $1.7890 late Wednesday. In New York, it cost $1.7975 to buy one pound, more expensive than Wednesday’s $1.7930.

Other late dollar rates in New York, compared to late Wednesday’s rates, included: 1.7540 West German marks, down from 1.7635; 1.4745 Swiss francs, down from 1.4830; 5.9970 French francs, down from 6.0180; 1,307.00 Italian lire, down from 1.312.65, and 1.2217 Canadian dollars, down from 1.2312.

Other late dollar rates in Europe, compared to late Wednesday’s rates, included: 1.7565 West German marks, down from 1.7665; 1.4765 Swiss francs, down from 1.4865; 6.0065 French francs, down from 6.0460; 1.9825 Dutch guilders, down from 1.9935; 1,311.00 Italian lire, down from 1,319.50, and 1.2246 Canadian dollars, down from 1.2325.

Gold prices fell. On the New York Commodity Exchange, bullion slipped to $419.00 an ounce, from $423.10 on Wednesday.

In London, gold fell to a late bid of $419.75, compared to Wednesday’s $423.25. In Zurich, Switzerland, the metal fell to a closing bid of $419.70 from $420 bid late Wednesday. Earlier in Hong Kong, gold rose $2.91 to $424.23 bid.

Silver bullion prices were mixed. On the New York Comex, silver fell to $6.411 an ounce, from $6.548 Wednesday. But in London, the metal rose to a late bid of $6.48 from Wednesday’s $6.44.