Dollar Dips against Most Major Currencies; Gold Prices Higher

Article excerpt

NEW YORK (AP) - The dollar drifted lower against most major currencies in quiet trading Monday, extending Friday's losses after the government reported an unexpectedly large increase in the June trade deficit.

Gold prices were higher. Republic National Bank of New York at 4 p.m. EDT quoted gold bullion at $454.00 a troy ounce, up $2.50 from Friday's close.

John McCarthy, a trader with Irving Trust Co., said the dollar's decline was a follow-through from Friday, when it was pushed down by a Commerce Department report showing the trade shortfall widened to $15.7 billion in June, an apparent record.

The report had raised the question in financial circles as to whether the dollar needed to fall further to have a positive impact on the U.S. trade performance, dealers said.

But McCarthy said, ``The general consensus is mixed. There's still quite a few people who believe the dollar isn't going to go much lower.''

Continued tensions in the Middle East, where U.S. warships are escorting reflagged Kuwaiti tankers through the war-torn Persian Gulf, are keeping the dollar from falling even further, said Dan Holland, a trader with Discount Corp.

The dollar is often seen as a safe haven during times of international tension.

In Tokyo, where trading ends before Europe's business day begins, the dollar plunged 2.20 Japanese yen, closing at 150.20 yen compared with Friday's 152.40 yen. It was quoted lower in London at 150.00 yen. Later, in New York, the dollar stood at 149.32 yen, down from 149.93 late Friday.

The dollar fell against the British pound in London and the United States. …