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To: Bobby Yellin who wrote (29161)	2/28/1999 9:53:00 PM
From: goldsnow	Respond to of 116791

Dollar Little Changed vs Yen Amid Concern U.S. Stocks May Continue Slide Dollar Steady vs Yen Amid Concern U.S. Stocks May Extend Slide Tokyo, March 1 (Bloomberg) -- The dollar was little changed against the yen, after Friday falling to a one-week low, amid concern U.S. stocks may fall further, sapping demand for dollars to buy securities. U.S. stocks Friday fell for a third day, after Federal Reserve Chairman Alan Greenspan earlier in the week boosted expectations for higher U.S. interest rates by saying the economy continues to expand at a ''surprisingly robust'' pace. Higher U.S. rates raise corporate borrowing costs, hurting stocks. ''The dollar is affected by the U.S. rate prospects,'' said Ryuichi Takami, a foreign exchange manager at Sanwa Bank Ltd. ''Expectations for U.S. monetary tightening will eventually lead to a stronger dollar,'' because higher U.S. rates make dollar- denominated deposits more attractive, he said. The dollar was quoted at 119.30 yen, up from 119.21 yen in late New York trading Friday. The euro was quoted at $1.0997, down from $1.1028 in New York. The U.S. currency Friday fell for a second day to 118.45 yen, its weakest since Feb. 18, as the Dow Jones Industrial Average sank 0.6 percent. Global investors selling U.S. stocks often convert the dollar proceeds into other currencies. That hurts the dollar. Poised to Rebound To be sure, the dollar probably won't fall below 117.50 yen this week and is poised to rebound to 122.50 yen by the end of the week as traders focus on economic conditions in the U.S. and Japan, said Sanwa Bank's Takami. ''People have strong incentives to buy the dollar when it dips,'' he said. The U.S. said Friday the economy during the last three months of 1988 grew at the fastest pace in more than two years, expanding at a 6.1 percent annual rate in the fourth quarter. Japan's economy, by comparison, is expected to shrink 2.2 percent in the year ending March 31. If the U.S. economy continues its robust growth, that could increase the need for the Fed to raise the target federal funds rate on overnight loans between banks from 4.75 percent in coming months, traders said. The comparable rate in Japan is 0.15 percent, a record low. ''People have no choice but to park their money in the U.S.'' to seek higher returns, said Mikiyasu Yuasa, a foreign exchange manager at Bank of Tokyo-Mitsubishi Ltd. ''The dollar remains on a firm footing.'' The dollar is likely to trade between 118 yen and 123 yen throughout the month, Yuasa said. In other trading, the dollar was quoted at 1.4489 Swiss francs, up from 1.4462 Swiss francs in late New York trading Friday. The British pound was quoted at $1.5992, down from $1.6025 in New York. ©1999 Bloomberg, LP. All rights reserved. Terms of Service and Trademarks.