Newspaper article THE JOURNAL RECORD

Dollar Rises Erratically; Gold Hits 3-Month High

Newspaper article THE JOURNAL RECORD

Dollar Rises Erratically; Gold Hits 3-Month High

Article excerpt

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NEW YORK (AP) - The dollar was pushed erratically higher Monday by traders focused almost exclusively on the stream of Persian Gulf developments leading up to Tuesday's midnight war deadline.

Gold closed at its highest level in more than three months. In New York, the precious metal's contract for immediate delivery broke $400 a troy ounce on the Commodity Exchange, increasing $8.50 a troy ounce to close at $400.10. Republic National Bank quoted a late bid for gold of $398.35 an ounce, up $7.

The last time the immediate contract for gold surpassed $400 was on Oct. 8.

Trading in both markets was described as thin and extremely volatile, dominated by speculation and interbank transactions that tried to exploit the safe-haven appeal of the two investments.

``It was really hanging onto every headline that appeared on the screen,'' said Robert Hatcher, corporate dealer for Barclays Bank PLC. ``Nobody has any real views - it's just a question of read the news and go with it.''

The dollar initially was boosted when U.N. Secretary-General Javier Perez de Cuellar conceded that his talks with the Iraqi president on Sunday - considered the last best chance for peace - were a failure.

``Unfortunately, I don't see any more reasons to be optimistic,'' the U.N. leader said in Paris after meeting with French President Francois Mitterrand.

Traders said the market was sent downward on a report on Cable News Network that Iraq was prepared to pull out of Kuwait, but the dollar recovered soon after when CNN modified its story.

Early reports that Yemen had drafted a peace proposal that was accepted by the United States also undermined the dollar's position. …

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