BAKER SAYS DOLLAR DROP WOULD BE COUNTERPRODUCTIVE
Treasury Secretary James
Baker said any further decline in the dollar against other
currencies would be counterproductive.
    Baker was asked after a speech to the Pan American Economic
Leadership Conference about U.S. policy in light of President
Reagan's comment last week at the Venice summit that he could
see some further decline in the dollar within reason.
    "All of the G-7 nations believe that any further decline in
the dollar would be counterproductive," Baker told reporters.
    Following the Venice press conference by Reagan, the White
House clarified Reagan's comments on the dollar by saying that
the United States wants a stable dollar.
    The main incentive for the United States to favor a weaker
dollar has been the need to reduce the massive trade deficit,
but the deficit has narrowed for the past two months and
appears to be responding to the 40 pct drop in the dollar
against the yen and the mark during the past two years.
 Reuter
