Exchange Rate

MEXICO CITY -- Responding to pressure from the United States, Mexico's central bank announced yesterday that it was raising already high short-term interest rates a further 10 percentage points, pushing the rate on some government debts to 50 percent.U.S. officials have insisted that Mexico tighten its credit substantially and reduce its money supply as part of the conditions of $20 billion in U.S. assistance proposed by the Clinton administration.An official at the Mexican central bank said yesterday that the decision to increase interest rates "arose from the negotiations between Mexico and the United States" continuing in Washington, and the sharp declines in the value of the peso at the end of last week.

Are there any countries where the dollar is doing well and travel is still a good value? Despite the dollar's loss in value, especially against the euro and the British pound, there are a few places where our currency still has muscle. Experts at hot wire.com and orbitz.com agree on these two destinations, where exchange rates are favorable and prices are low: Thailand and Argentina. Barbara Messing, Hotwire's travel expert, says you can still get a $12 steak dinner and an $8 bottle of wine in Buenos Aires, Argentina, a cosmopolitan city that often reminds visitors of Paris - there are long boulevards, scenic parks and great shopping.

HERE is a Japanese view of the U.S.-Japan trade imbalance from an editorial in Asahi Shimbun, Tokyo:". . . In the American car market, Ford's Taurus has taken over the position of the best-selling car from Honda's Accord."The American cars, whose producer took a page out of the book on Japanese-style business management, became competitive with Japanese cars in terms of both quality and price and the market share of Japanese cars has been steadily declining."On top of that, the yen has become stronger since the beginning of the year.

Xchanger, the 3-year-old son of Exchange Rate and the winner of Saturday's Federico Tesio Stakes at Pimlico Race Course, still doesn't know where he will be on the first Saturday in May. Will he be at the Kentucky Derby or in his Fair Hill Training Center stall? The colt's owners, Circle Z Stables, which includes Baltimorean Domenico Zannino and trainer Mark Shuman, have the option of entering him in the Derby, looking ahead to the Preakness or selling him. Shuman said last night offers for at least seven figures have been received, but so far no one has hit "the magic" number.

DAVOS, Switzerland -- Maybe it's a sign of maturity, or maybe it's just that typical American obliviousness to the outside world. Whatever the reason, the United States has an admirably relaxed attitude toward the international value of its currency. When the dollar slides against the yen, we do not take it as a slur on our national virility. Indeed, the strong yen mainly has the Japanese worried, because they fear -- rightly -- that it may price their goods out of world markets and make their now-you-see-it-now-you-don't economic recovery vanish into thin air. Blas is OK As far as the economic fundamentals are concerned, euroland -- the group of 11 European nations that has adopted the euro as its common currency -- ought to be as blase about currency fluctuations as we are. Like the United States, euroland is a huge economic area, mainly trading with itself; if its exchange rate fluctuates, as exchange rates will, why should it be concerned?

Because financial markets were closed yesterday for Thanksgiving, no stock or mutual fund tables appear in today's editions.In addition, a number of markets will hold abbreviated sessions today. The New York, American and Nasdaq stock exchanges will close at 1 p.m. Corporate and treasury bond markets will close at 2 p.m. The Chicago Board of Trade will close at 1 p.m., Chicago Mercantile Exchange at 1 p.m. except equity index contracts, which will close at 1:15 p.m.. On the Chicago Board Options Exchange interest rate contracts will close at 1 p.m. Eastern time, equity options at 1:10 p.m. and equity index options at 1:15 p.m.@

WASHINGTON - Even as it publicly pressures China to let its currency rise in value, the Bush administration has quietly softened a crucial demand. In a calculated shift, administration officials have stopped demanding that China let it currency, the yuan, float freely against other major currencies. Instead, American officials are telling Chinese leaders that they can keep their policy of a fixed exchange rate - at least for now - if they increase the yuan's value by 10 percent to 15 percent.

NEW YORK -- The road is long, and nobody said it was easy. But for 3-year-old thoroughbreds across the country -- no, the world -- the journey is drawing to a close. Today, in major races in Kentucky, Arkansas and New York, 34 horses will take their final strides in competition along the road that leads to America's spring classics: the Kentucky Derby May 6 at Churchill Downs, the Preakness May 20 at Pimlico and the Belmont June 10 at Belmont Park. For some, such as Mighty, Snuck In and Fusaichi Pegasus, the races today are minor hurdles to overcome; their Derby tickets are punched.

HEIDELBERG, Germany -- A day after Michael Kingsley arrived in this romantic university town, he was in no mood to savor the cobblestone streets, the half-timbered houses or the flower-bedecked windows - to say nothing of the camera-ready castle on the hill. Kingsley had left his camera battery and charger in a hotel room in London, and he knew that as an American tourist, buying replacements here was going to sting. The damage: $143. Back home in Falls Church, Va., he said, the same purchase would have set him back no more than $100.

ZAANDAM, Netherlands -- Royal Ahold NV, the world's sixth-largest supermarket owner, said its first-quarter profit rose 32 percent, less than expected, as Brazil's currency crisis and a weaker dollar bled some of the inflow from Giant Food in the United States.Net income rose to 175.1 million euros ($183 million) in the first three months of this year from 133.1 million euros, missing estimates because Royal Ahold wrote off exchange-rate costs at its Brazilian unit, Bompreco. Earnings rose 12 percent to 0.27 euro a share.