Dollar Slips as G-7 Fails to Put Its Money Where Its Mouth Is
The dollar edged lower against major currencies Monday after policy-makers from rich industrial nations issued a weekend statement of support but failed to follow up with aggressive dollar buying.
Officials from the Group of Seven nations--Britain, Canada, France, Germany, Italy, Japan and the United States--issued a statement Saturday after meeting in Washington hailing the dollar’s recent rise and calling for more.
In late New York trading, the dollar stood at 100.48 yen, down slightly from Friday’s close at 100.53. It slipped to 1.4130 marks from 1.4215 on Friday.
A rush to buy marks for French francs and other European currencies that have been under attack recently has put pressure on the dollar.
The dollar was undermined against the mark Monday by France’s large budget deficit. When the mark rises against European currencies, it usually rises against the dollar too, as speculators look for every opportunity to buy the German currency. Early in the day, the German currency rose to a four-month high of 3.5339 francs.
Later, the franc rebounded from its lows, and the mark retreated from its highs against the dollar and other currencies, after the Bank of France raised its 24-hour lending rate to 7.25% from 6.15%.
The mark was last at 3.5087 francs, down from 3.5125 francs late Friday in New York.
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