Futures Markets: Commodity Prices Post Modest Gains Led by Currencies
Most foreign-currency futures prices rebounded from record lows in heavy, erratic trading, leading commodity futures prices moderately higher.</br></br>Unconfirmed rumors of concerted intervention in foreign exchange trading by non-U.S. central banks prompted nervous profit-taking on recent drops in currency futures prices. Separately, remarks by Federal Reserve Board Chairman Paul Volcker indicating that the foreign banks hadn't intervened forcefully enough in the past on behalf of their faltering currencies also led to buying.</br></br>"Traders decided to ring the register and turn paper profits into cash," said Gary Dorsch, an analyst in Chicago for Oppenheimer Rouse Futures Inc.</br></br>Many analysts saw yesterday's rally as a technical correction, remaining bearish on foreign currency futures for the longer term. "The dollar has lost none of its aura," said Ira Epstein, president of Ira Epstein & Co., an affiliate of Shatkin Trading Co.</br></br>Swiss franc futures led the gains, rising 0.36 cents a franc to close at 34.65 cents a franc for March delivery on the Chicago Mercantile Exchange. Metal, grain and other commodity futures prices also rebounded from Monday's steep declines, following trends in currencies. The strong dollar, which tends to curb demand for U.S. commodities and encourage competing imports, has hammered U.S. commodity prices with each of its surges in value in recent years.