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Bonds gain, dollar lingers
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March 16, 1998: 5:13 p.m. ET
Overnight dollar rally stalls, but strong currency helps push up bonds
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NEW YORK (CNNfn) - The dollar rose to two-month highs against the Japanese yen overnight Monday, then stalled and spent the rest of the day hovering in a narrow range while other U.S. markets rallied.
The greenback's strength was enough to fuel buying in the bond market and help stocks rally to a record close.
New signs that Tokyo is unable to tackle its severe economic problems helped propel the dollar against the yen in overnight trading as several high-ranking Japanese officials spoke about the country's ailing banking system, a new economic stimulus package and zero economic growth for the current fiscal year, which ends March 31.
The dollar also rose against major European currencies, but trading was limited as many investors remained out of the market ahead of key economic data from Britain, Germany and the United States later this week. On Tuesday and Wednesday, Britain will release its consumer inflation and retail sales reports. On Thursday, Washington will share its international trade report for January and Germany will release a key business sentiment survey.
Meanwhile, a strong dollar and prospects for low inflation amid tumbling world oil prices buoyed the bond market, leading the price of the benchmark 30-year Treasury bond 14/32 of a point higher, lowering its yield to 5.86 percent.
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