The dollar settled mostly higher in relatively stable worldwide currency trading Friday despite turbulence in the credit and stock markets.
Gold prices were mostly higher. On the New York Commodity Exchange, gold bullion for current delivery settled at $328.00 a troy ounce, up 90 cents from Thursday. Republic National Bank said gold added 90 cents an ounce to a late bid price of $327.90.The dollar gained in Europe as buyers sought a safe haven from the mounting political instability in Russia, where President Boris Yeltsin continued to press for a nationwide referendum after the Congress of People's Deputies slashed his powers.
Concerns about Russia, coupled with a U.S. government report showing a surprising blip of wholesale price inflation in February, sent the U.S. stock and bond prices into a tailspin when trading shifted to domestic markets.
The Dow Jones average of 30 industrials finished the session with a near 30-point loss; the Treasury's bellwether 30-year bond fell $15 per $1,000 in face value as its yield rose.
The markets had been expecting a 0.3 percent rise in the Producer Price Index, but the Labor Department reported the gain at 0.4 percent, the biggest jump in more than two years. Separately, the government said business sales slipped 0.2 percent in January, the first decline in five months.
"The dollar was remarkably stable considering these developments," said Michael Malpede, an analyst with Refco Group Ltd. in Chicago.
He said the situation in Russia likely will delay long-awaited interest rates cuts in Europe, particularly in Germany, which has heavy exposure to Russian debt.
"That may limit short-term dollar demand that was based on speculation that rates would be coming down overseas," Malpede said.