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To: Broken_Clock who wrote (14847)	7/23/1998 10:04:00 PM
From: goldsnow	Respond to of 116762

Here it is... Dollar Falls vs Yen as Traders Brace for Possible Leadership-Vote Runoff Dollar Falls vs Yen as Traders Brace for LDP Runoff (Repeat) (Adds name after quote in 2nd paragraph.) Tokyo, July 24 (Bloomberg) -- The dollar fell against the yen as traders braced for a possible runoff in a leadership election among Japan's ruling Liberal Democratic Party. If Foreign Minister Keizo Obuchi, the favorite, fails to win a majority of the votes in the first round of the three-man race and the election proceeds to a runoff between the top two, ''that will surprise the market and there's risk the yen will rise,'' said Hiroshi Sakuma, a foreign exchange manager at Barclays Bank Plc. The dollar was quoted at 140.68 yen, down from 141.30 yen in late New York trading yesterday. That's also down from 142.08 yen it touched yesterday, its strongest since July 13, after Moody's Investors Service Inc. said it may cut Japan's sovereign debt rating from its top notch ''Aaa.'' Traders said the dollar's earlier rise reflects their view that Obuchi lacks leadership strong enough to pull the economy out of its worst postwar recession. ''The currency market has already priced in the likely victory of Obuchi,'' Sakuma said. Sakuma said he doesn't expect the dollar to top 141.20 yen before the LDP holds the presidential election at 2 p.m. local time. Obuchi needs to win more than 208 votes from 414 LDP delegates to avoid a runoff with either Health and Welfare Minister Junichiro Koizumi or former Chief Cabinet Secretary Seiroku Kajiyama. The three contenders have pledged tax cuts and steps to restore confidence in the Japanese banking industry and the economy. Obuchi Scenario ''There are persistent expectations in the market that Obuchi's victory will lead to selling of the yen,'' said Takeshi Imamichi, a foreign exchange manager at Industrial Bank of Japan Ltd. ''But if he carries out his pledges, which meet what the U.S. has long demanded, that isn't so bad for the economy. So I personally don't feel that Obuchi's victory will lead to any aggressive dollar buying.'' Obuchi has promised he will cut more than 6 trillion yen in taxes and boost spending by 10 trillion yen. Imamichi said he expects the dollar to trade between 140 yen and 142 yen today. The dollar fell also because of declines in U.S. stocks and speculation the U.S. and Japan may sell dollars for yen to stem the Japanese currency's further decline, Imamichi added. The Dow Jones Industrial Average yesterday fell for a fourth day, tumbling 195.93, or 2.2 percent, to 8932.98. Meanwhile, speculation spread through the currency market in New York and London yesterday that the U.S. Federal Reserve sold Treasury bills on behalf of the Bank of Japan, in possible preparation for another round of intervention. The U.S. and Japan jointly sold dollars on June 17, a day after the currency touched an eight-year high of 146.78 yen. They took action when the dollar traded above 142 yen. ''The dollar at the 142-yen level is where we've seen intervention last,'' said Imamichi. ''So some people in the currency market are concerned about possible intervention.'' In other trading, the dollar was quoted at 1.7846 marks, down from 1.7847 marks in late New York trading yesterday. The dollar was quoted at 1.5045 Swiss francs, down from 1.5048 Swiss francs in New York. The British pound was quoted at $1.6517, up from $1.6513 in New York. The mark was quoted at 78.84 yen, down from 79.15 yen in New York. bloomberg.com@@IFAxIgYAH9x1XzHe/news2.cgi?T=news2_ft_topww.ht&s=560337912