U.S. TREASURY'S BAKER SAYS RATE SHIFTS ORDERLY
  Treasury Secretary James Baker said
  that changes in exchange rates have generally been orderly and
  have improved the prospects for a reduction in external
  imbalances to more sustainable levels.
      In remarks before the IMF's policy-making Interim
  Committee, Baker reiterated a Group of Seven statement last
  night that the substantial exchange rate changes since the
  Plaza agreement 18 months ago have "now brought currencies
  within ranges broadly consistent with economic fundamentals."
      Baker said, "These exchange rate shifts have generally been
  orderly, and have improved prospects for the reduction of
  external imbalances to more sustainable levels."
      As they are today, the trade and current account imbalances
  "simply are not sustainable," Baker told the ministers.
      He said that the Reagan administration was resisting "strong
  domestic pressure" for trade protection and was working closely
  with the U.S. Congress in crafting a trade bill.
      "While we cannot yet be sure of the outcome, we are doing
  what we can to ensure that the bill is not protectionist," he
  said.
      Baker also urged the International Monetary Fund's
  executive board to review possible modifications to the Fund's
  compensatory financing facility before the annual meeting this
  fall.
      "We should pay particular attention to the lack of
  continuing conditionality associated with the use of the CFF
  and to whether shortfalls in export earnings are indeed
  temporary," he said.
  

