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FIRST CHICAGO

THE FIRST NATIONAL BANK OF CHICAGO

One First National Plaza, Chicago, Illinois

(August 8, 1997) CURRENCIES: Continued moderate U.S. economic growth and modest inflation are expected to provide support for the dollar relative to the DM and yen. Prospects for the dollar vis-a-vis the European currencies are particularly good, as uncertainty with regard to the common currency has recently dampened the DM. The dollar is expected to improve further relative to the DM, reaching 1.90 DM/dollar by year-end.

The upside relative to the yen is more limited, and reflects longer-term structural imbalances and political pressures on both sides. The forecast calls for a 121 yen/dollar exchange rate by the year-end.

Consensus National Futures and Financial On Line Index
Financial Index

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