Dollar Falls Vs. Most Currencies
Wednesday, 2 December 1998
N E W Y O R K (AP)
THE DOLLAR sank Wednesday against most major currencies as a slump in
U.S. stock prices dampened demand for the currency.
A dollar bought 119.93 Japanese yen in late New York trading
Wednesday, down from 122.17 yen late Tuesday. The dollar fell to
1.6697 German marks in New York from 1.6810 marks Tuesday.
"The dollar started the day weak on expectations that the U.S. equity
markets would be weak," said Guillermo Estebanez, a foreign exchange
economist at Bank of America in San Francisco.
He said the dollar recovered a bit late in the day as stock prices, while still
finishing broadly lower, had rebounded from the lows of the day.
The Dow Jones industrial average tumbled more than 100 points in the
early going on Wall Street and was off more than 178 points by early
afternoon before it rallied to close with a 69-point loss for the day.
The stock market had only last week reached new record highs, but has
been down this week. Boeing's announcement late Tuesday that it was
cutting an additional 20,000 jobs hurt stock prices on Wednesday as did a
weak November sales report from the big retailer Sears.
Estebanez said the stock market's performance this week served as a
reminder that "for the dollar to maintain its strength, we need to have good
yields" on stocks.
The dollar's decline came despite a strong housing sales report, a
suggestion that the economy continues to grow.
But Estebanez noted that even with the dollar's decline on Wednesday, it
has remained within "reasonably natural ranges for many weeks."
Other late dollar rates in New York, compared with late rates Tuesday,
included: 1.3655 Swiss francs, down from 1.3812; 5.600 French francs,
down from 5.6445; 1,653.10 Italian lire, down from 1,664.00; and
1.5340 Canadian dollars, up from 1.5310.
The British pound was quoted at $1.6675, up from $1.6543. |
