Dollar Rises Sharply; Gold Declines
NEW YORK — The dollar rose sharply against other major currencies Friday amid indications of a strengthening U.S. economy and an upturn in American interest rates.
The dollar’s advance in the United States included gains of nearly 10 French centimes, 3.75 West German pfennigs and nearly 2 Japanese yen.
Gold prices fell. Republic National Bank in New York quoted gold as of 4 p.m. EDT at $333 an ounce, down $1.75 from Thursday’s late bid.
Currency dealers said the dollar drew initial support in Europe after the Commerce Department reported that the U.S. trade deficit fell 22% in July to $10.5 billion, the lowest shortfall since January.
Later, the dollar was boosted by a sharp rise in American interest rates, which raised the yields available on dollar-denominated investments, dealers said.
Technical factors also contributed to the dollar’s gain, traders said.
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