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To: Alex who wrote (22674)	11/6/1998 1:51:00 PM
From: Ahda	Respond to of 116972

Friday November 6, 1:28 pm Eastern Time (Note: this article is ''in progress''; there will likely be an update soon.) FX IN EUROPE-Dollar recovery running out of steam LONDON, Nov 6 (Reuters) - Recovering bond and equity markets set a firmer tone for the dollar this week, but the move up is running out of steam and the U.S. currency is likely to stall because currency markets remain unconvinced. ''People are beginning to think the credit crunch is easing, equity and bond markets are coming back,'' said Michael Lewis, senior currency economist at Deutsche Bank Research. ''The dollar is higher but it's losing momentum. Currency markets are sceptical a credit-crunch has been averted.'' Analysts believe the one-month high of 1.6705 seen on Wednesday could cap dollar/mark upside until the new year. For most of the Friday session, dollar/mark traded in a half pfennig range around 1.66, and by 1545 GMT it was quoted at 1.6614/19 versus 1.6561/64 in late European trade on Thursday. The Dow Jones Industrial Average since early October has gained more than 1000 points or 14 percent to over 8900, from the lows of September, on the back of calmer credit markets and perceptions of an improved outlook for Brazil. ''But the dollar hasn't made the same gains against the mark and yen (as has the Dow),'' Lewis said. ''There is still some momentum behind dollar/yen, but I think that will only last to 120. Japan has to recycle the current account surplus.'' By 1550 GMT dollar/yen was about 3.5 percent higher than the lows earlier this week. It was last quoted near one-week highs at 118.35/45 against 117.23/33 late Thursday. Growing confidence that an economic crisis in Brazil may be averted can be seen in Brazil's leading benchmark equity index which jumped 3.31 percent on Friday after gaining 24 percent in the previous four sessions. Audrey Childe-Freeman, economist at CIBC World Markets sees dollar/mark stabilising around 1.65. ''Fundamentals for the mark and euro look better than they do for the dollar, despite the recent data.''