G-7 SEEN FIGHTING TO KEEP CURRENCY PACT
International monetary officials will 
rush to paper over the deep cracks that have appeared in the
Louvre accord on currency stability to prevent a dollar
free-fall and to calm turmoil in world capital markets,
economists and currency traders said.
    "I don't think the Louvre is dead because if it breaks up
in an acrimonious way, the potential outcome is a rout of the
dollar, higher interest rates and collapsing stock markets.
It's in the Group of Seven's interest to calm things down,"
said Douglas Madison, corporate trader at BankAmerica Corp.
   
    In a weekend television interview, U.S. Treasury secretary
James Baker sharply criticised a recent rise in West German
money market rates and said the eight month-old Louvre pact to
foster exchange rate stability needs to be reviewed.
    His comments rocked the currency markets and helped send
the already-fragile U.S. and overseas stock markets into a
tailspin.
    The dollar lost more than two pfennigs in the U.S. to about
1.7740/50 marks and about one yen to 141.25/35 yen. The Dow
Jones Industrial Average slumped more than 200 points at one
stage and U.S. Treasury bonds dropped about 1-3/4 points.
   
 Reuter
