DOLLAR MOVES HIGHER IN TECHNICAL REBOUND

DOLLAR MOVES HIGHER IN TECHNICAL REBOUND

The U.S. dollar pushed higher on technical factors and comments by Federal Reserve Chairman Alan Greenspan in Washington about the high cost of the bailout of the country's savings and loans institutions.

The dollar rallied to the 1.6800 deutsche mark level Wednesday after it broke through a key resistance level of marks. Once that level was pierced, the dollar had no technical resistance upward, trader said.Further support came from news that Mr. Greenspan had said the cost of the thrift bailout would be astronomical.

Although the Fed chairman said he didn't think the increased cost of the thrift bailout would affect interest rates, the market didn't believe it, said John Lynam of Security Pacific Bank.

"The thinking is, if the bailout will in fact cost a huge amount of money, it's bound to pressure rates upward. (Interest) rates will be steady to higher," Mr. Lynam added.

Earlier in the day, the dollar extended late Tuesday lows on a soft durable goods report for April.

The British pound ignored a bearish U.K. trade figure, mostly because it was expected, and rallied, apparently on a huge order to buy pounds from the Mideast. Dealers said the National Commercial Bank of Jeddah, acting as a broker for the Saudi Arabian Monetary Authority, that nation's central bank, reportedly sold about 500,000 ounces of gold to buy the pounds.

The mark also weakened slightly against the yen to 90.31 yen a mark from late Tuesday's level of 90.40 yen. Swiss francs firmed to 0.8432 against the mark from late Tuesday's 0.8473. The mark is enduring a short-term bear trend on political opposition to German economic unification.

At Banque Indo-Suez, Leslie Puth said the market was shifting its stance

from testing the bottom of dollar-mark and dollar-yen rates to testing the top.