Dollar Surges Despite Efforts to Lower Rates

The U.S. dollar surged against major foreign currencies in European trading today, overcoming what dealers said was repeated central bank intervention.

Foreign exchange dealers said central banks intervened twice in the day to sell dollars in an effort to keep exchange rates down.

But the selling only encouraged the markets to regard the American currency as a good buy, dealers said.

They said the U.S. Federal Reserve entered the market alone for a third time, late in the day, but failed to stem the dollar’s rally.

In London, one British pound cost $1.7655 late today, cheaper for buyers than Thursday’s late $1.7730.

Other late rates for the dollar in Europe compared to Thursday’s late rates: 1.8570 West German marks, up from 1.8440; 1.5743 Swiss francs, up from 1.5671; 6.2875 French francs, up from 6.2705; 2.0880 Dutch guilders, up from 2.0815; 1,352.37 Italian lire, up from 1,350.25; 1.1853 Canadian dollars, up from 1.1816.

Earlier in Tokyo, the dollar closed at 128.65 Japanese yen, up from 127.52 yen. In London late today, the dollar traded higher at 128.93 yen.