NEW YORK, AUG. 25 -- The dollar strengthened significantly today, closing higher against all major foreign currencies in domestic trading on the heels of central bank intervention in the Far East.

Gold prices fell. Republic National Bank in New York quoted a late bid for gold of $457.50 a troy ounce, down $3 from $460.50 on Monday.

Traders said the Bank of Japan stepped in to support the U.S. currency by buying dollars in overnight trading in the Far East. The intervention forced some dealers to buy dollars to cover "short" positions taken by traders try to profit from future price declines by selling borrowed currencies and buying them later at lower prices. If the reverse occurs and those currencies start to appreciate, dealers buy the currencies quickly to square their positions.

Traders were concerned that "the central banks -- especially the Bank of Japan and possibly {West Germany's} Bundesbank -- are very serious about committing very substantial amounts of money to support the dollar," said Jack Barbanel, a senior vice president at Gruntal & Co.

The dollar put in a strong performance earlier in European trading, closing higher against all major foreign currencies except the Canadian dollar. Trading was somewhat thin, however, as many European dealers are on holiday.

Earlier in Tokyo, the dollar closed at 142.90 Japanese yen, up from Monday's 142.65. Later in London, the dollar also traded at 142.90 yen. The dollar rose further in New York, closing at 143.53 yen, compared with 141.93 yen on Monday