	after g round one goes to central banks central banks have easily beaten back the foreign exchange market s first test of the industrialized nations recent pact to stabilize currencies analysts said in active trading this week the market pushed the dollar sterling the canadian dollar and australian dollar higher but operators got their fingers burned as one by one the central banks signalled their displeasure so far g has been a roaring success said james o neill financial markets economist at marine midland bank na the central banks are sending strong signals that they won t tolerate any kind of momentum building behind currencies added a senior corporate trader at one u k bank on february the finance ministers and central bank governors of the u s japan west germany france and the u k the group of five plus canada signed an accord under which they agreed to cooperate closely to foster stability of exchange rates around prevailing levels the agreement was viewed by many in the market as an attempt to put a floor under the dollar after its sizeable two year decline against major world currencies and initially traders indicated their respect for the accord by refraining from pushing the dollar lower but by wednesday the dollar climbed to more than marks about five pfennigs above its levels the friday before the g accord the move was aided by indications that the u s economy picked up steam in february at the same time as the west german economy was regressing but dealers said the federal reserve bank of new york gave traders a sharp reminder that the g pact had encompassed the idea of limiting inordinate dollar gains as well as declines dealers differed as to whether the u s central bank actually intervened to sell dollars above marks or simply telephoned dealers to ask for quotes and enquire about trading conditions but the dollar quickly backed off it hovered today around marks the market was surprised that the fed showed its face so soon said marine midland na s o neill also on wednesday london dealers said the bank of england intervened in the open market to sell sterling as the u k currency rose to dlrs compared with dlrs before the g pact sterling along with the other high yield currencies like the australian dollar and canadian dollar was in favor after traders surmised that the the chance of intervention pursuant to the paris currency accord left limited room for profit plays on dollar mark and dollar yen the pound also was boosted by suggestions of an improving u k economy anticipation of a popular british budget on march and public opinion polls showing good chances for the incumbent conservative party in any general election there was a real run on sterling said anne mills of shearson lehman brothers inc sterling traded today around dlrs down from dlrs last night it slid to marks from yesterday and from a peak of about recently there s been some heavy profit taking on sterling mark ahead of next tuesday s u k budget said james mcgroarty of discount corp as speculators detected the presence of the u s and british central banks they acclerated their shift into canadian and australian dollars but here too they were stymied the bank of canada acted to slow its currency s rise the canadian dollar traded at per u s dollar today down from yesterday and the australian reserve bank using the fed as agent sold australian dollars in the u s yesterday dealers said the australian dollar fell to a low of u s cents today from a high of thursday analysts said the central banks moves to stifle sudden upward movement leave the market uncertain about its next step today the focus shifted to the yen which has held to a very tight range against the dollar for several months the dollar fell to yen from last night analysts said the yen also gained as traders unwound long sterling short mark positions established lately because of the change in perceptions about the health of the german economy the funds from those unwinding operations are ending up in yen a dealer at one u k bank said recent west german data have shown falling industry orders lower industrial output and slowing employment gains moreover the yen is benefitting as japanese entities who have invested heavily overseas for example in australian financial instruments repatriate their profits ahead of the end of the japanese fiscal year on march noting that the dollar yen rate is in a sense the most controversial one because of the large u s trade deficit with japan analysts said the stage could be set for another test of the dollar s downward scope against the japanese currency in its latest review of the foreign exchange market through the end of january the federal reserve revealed that it intervened to protect the dollar against the yen on january on that day the dollar fell as low as yen sure the fed bought dollars near the yen level in january but the market has to bear in mind that time marches on and the situation changes said mcgroarty of discount 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