Dollar Is Mixed as U.S. Posts Wider June Trade Gap but Trims May Deficit
The dollar was mixed in foreign-exchange trading yesterday as the announcement that the U.S. trade deficit grew in June was offset by a downward revision of the May gap.</br></br>The dollar's decline was checked yesterday because traders were reluctant to keep pushing the unit down. They were concerned that the West German and Japanese central banks would intervene to support the dollar, pushing it higher.</br></br>Many bank traders said they remain pessimistic about the dollar's outlook but are holding off opening any new positions in the market so they can close their books for July.</br></br>"The dollar bearishness is still very much in evidence, but at the end of the month people are intent on getting their positions square," said Robert Hatcher, vice president and corporate foreign-exchange dealer at Barclays Bank International, New York. "Once we get into August, it's open season on the dollar again," he said.</br></br>After yesterday's Commerce Department report that the U.S. trade deficit widened in June to $14.17 billion, which was above many traders' expectations, the dollar fell to its intraday lows of 2.1065 West German marks and 155.55 Japanese yen. A June trade deficit of between $12.5 billion and $13.5 billion was widely expected.