Dollar Moves Higher; Gold Prices Also Up
Gold prices rose. Republic National Bank of New York at 4 p.m. EST quoted a bid for gold bullion at $411 a troy ounce, up from $405.50 late Friday.
After declining initially in European dealings, the dollar was supported by West Germany's central bank, the Bundesbank, which purchased around $22 million to support the U.S. currency, traders said.
Last week, the dollar hit its lowest levels against the West German mark since October 1980.
Dealers said the dollar's downward trend also was slowed by widespread expectations that finance ministers and central bankers of the ``Group of Five'' industrialized nations - the United States, West Germany, France, Britain and Japan - would meet soon to discuss measures for stabilizing the currency.
``People think it's inevitable that we're going to get another G-5 meeting soon,'' said James O'Neill, vice president for international treasury management for Marine Midland Bank in New York.
Despite Monday's reprieve, the outlook for the dollar remains strongly bearish. Market participants and observers generally are anticipating U.S. trade figures for December to be poor when released Friday. The U.S. trade deficit hit an annual rate of about $170 billion in the first 11 months of 1986.
In Tokyo, where trading ends before Europe's business day begins, the dollar closed at 152.75 Japanese yen, up from 152.30 yen late Friday. The dollar traded at 152.50 yen late in London, and later in New York, the dollar closed at 152.80 yen, up slightly from 152. …