DOLLAR LOWER AGAINST MARK, HIGHER VS. YEN POUND STRONG

DOLLAR LOWER AGAINST MARK, HIGHER VS. YEN POUND STRONG

The U.S. dollar was mixed in quiet trading Monday.

In early afternoon trading, the dollar was lower against the deutsche mark, but higher against the Japanese yen and Canadian dollar.Dealers said the dollar drifted toward the lower end of its recent range of 1.66 to 1.68 deutsche marks.

They said the decline was an extension of last week's inability to top DM1.68, a long-standing resistance level.

But analysts said this week's U.S. economic reports could give the dollar a healthy push back toward DM1.68.

Meanwhile, the British pound remained strong despite some volatility in U.K. election polls ahead of the April 9 general election.

The yen fell on new talk of a Japanese interest rate cut and the sharp drop on the Tokyo stock exchange. Monday, the Nikkei stock average fell 3 percent on the day, closing below the 20,000 level for the first time since early 1987.

The Canadian dollar also remained soft on talk of lower interest rates. Throughout last week and the week before, the Bank of Canada intervened repeatedly trying to buoy its currency.

Commenting on the dollar's decline against the deutsche mark, one chief dealer said, "We couldn't broach 1.68 marks last week, so now we're checking the bottom again, and if 1.66 marks holds, we're ready for another siege at the top."

He added that "the bias (for the dollar) remains toward the upside. The sense is this week's economic reports will give the dollar all the push it needs to top 1.68 marks."

Earl Johnson, chief dealer at Harris Bank, Chicago, said the dollar came under some pressure Monday, but that the softening was caused by profit- taking.

"All the numbers we expect this week should be basically supportive to the dollar. Though there's some uncertainty, the emphasis is on recovery," Mr. Johnson said.

Several economic reports for February will be released today.