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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (21411)	10/11/1998 9:16:00 PM
From: goldsnow	Respond to of 116894

I wonder how traders/hedgers feel....More important :) Dollar Steady Amid Fund Woes After Biggest Weekly Drop Since 1971 Dollar Steady Amid Fund Woes After Biggest Weeks Drop Since '71 Tokyo, Oct. 12 (Bloomberg) -- The dollar was little changed against the yen, following last week's biggest weekly decline since major currencies went off the gold standard in 1971, amid concern hedge funds may sell more dollars to pay back yen loans. Many hedge funds in the past three years borrowed yen at Japan's record low lending rates and converted the Japanese currency into dollars to finance investments in emerging markets. As Asia's economic and currency crisis spread to Russia and Latin America, the funds began to reverse so-called yen-carry trades. ''If hedge funds continue to unwind their yen-carry trades, the yen will no doubt strengthen,'' said Masao Yoshikawa, head of the customer desk at Industrial Bank of Japan Ltd. ''I expect the dollar to continue to be sold into rallies.'' The dollar was quoted at 116.70 yen, up from 116.65 yen in late New York trading Friday. It was quoted at 1.6397 marks, up from 1.6343 marks in New York. The U.S. currency fell throughout last week, touching a 16- month low of 111.58 Thursday. That's nearly a 20-yen decline from where it traded early Wednesday. During the week, it tumbled about 14 percent. And from an eight-year high of 147.66 yen on Aug. 11, the dollar's down about 21 percent. ''You need a lot of courage to buy dollars,'' said IBJ's Yoshikawa. Japanese exporters will sell dollars when the U.S. currency nears 125 yen, and the dollar is likely to remain volatile this week, trading between 111 yen and 121 yen, he added. Banking Legislation The yen has strengthened also because of expectations Japan will pass legislation that will help restore health to the Japanese banking industry. Saddled with problem loans of at least 77 trillion yen, Japanese banks have been reluctant to lend, hurting corporate activities and the economy. The full upper house of Japan's parliament is expected today to approve the bill, which will empower the government to seize insolvent lenders and help banks dispose of bad debts. A second set of bank bills, calling for the injection of taxpayer money into solvent but faltering banks, is still being debated in the Diet, or parliament. U.S. financial markets are closed today as the country observes the Columbus Day holiday. In other trading, the dollar was quoted at 1.3261 Swiss francs, up from 1.3230 Swiss francs in late New York trading Friday. The British pound was quoted at $1.6982, down from $1.7084 in New York. The mark was quoted at 71.17 yen, down from 71.39 yen in New York. bloomberg.com