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The American dollar posted a succession of six-year highs versus the Deutsche mark in the week ended Jul 25, l997. Meantime, confusion in Asian currency markets has heightened the dollar's attraction as a safe harbor. The dollar's rise against the Swiss franc gives assurance that it will continue its upward motion, according to a currency strategist.

The US dollar strengthened vis-a-vis the German mark and other European currencies, except for the French franc which sustained its upswing. Currency dealers believe that France's refusal to lower interest rates despite Germany's lead placed the franc in a position of advantage. The trend indicates that interest rate differentials favor the French franc. However, the strength of the US dollar led some currency traders to cash in on the dollar in favor of the Japanese yen.

Long-term interest rates fell sharply on Monday, as a strong dollar lifted the government bond market. The yield on 30-year Treasury bonds fell to 6.77% from 6.80% on Friday. Blue-chip [...]

The US dollar rose against the deutsche mark but suffered slump against the Japanese yen. Analysts contribute the decline to the significantly wider US trade gap. In 3/93 the US trade gap reached $10.2 billion, its highest level in four years. The Japanese trade surplus rose to $5.2 billion for March, up from $4.1 billion in February 1993. Commerce Secretary, Ron Brown suggested that Japan undertake prompt fiscal stimulus as a way to reduce the trade deficit.