Dollar Decline Slows; Gold Up $10
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NEW YORK — The dollar continued to decline, but more slowly, against most major foreign currencies Tuesday.
The price of gold shot up more than $10 an ounce in response to the political turmoil in the Philippines but then settled down. Bullion was quoted at $347.75 an ounce at 4 p.m. EST at Republic National Bank, down 25 cents from Monday’s late bid.
Dealers said the dollar’s drop was triggered by remarks made Monday by Preston Martin, vice chairman of the U.S. Federal Reserve Board.
Martin said that a further 10% decline in the value of the dollar against other major currencies wouldn’t be a cause for alarm provided that it was accompanied by a continued flow of capital into the United States.
The dollar also was pushed down Tuesday by expectations of lower interest rates, which make dollar-denominated investments less attractive, and by a report from the Labor Department that consumer prices rose 0.3% in January.
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