DECLINE IN PRICES.

Sun (Christchurch), Volume VII, Issue 1956, 22 May 1920, Page 9

DECLINE IN PRICES.

LOWER RATES IN AMERICA. NEW ZEALAND UNLIKELY TO PARTICIPATE. [Special to The Sun.] WELLINGTON, May 21. The fall in retail prices, reported from the L'nitecl States, is not expected by local traders to be reflected in Wellington. Very few lines are being imported into New Zealand from America at the present time, owing to high manufacturing prices, and the adverse exchange. The decline reported in the cablegrams, moreover, is stated to be due to purely local conditions, created by speculation, and it does not mean that manufacturers' and merchants' prices have fallen. It is with the manufacturer or the merchant that the New Zealand importer must deal. "The news from America, as 1 read it, means simply that speculators have been caught long, and are cutting their losses by unloading on the retailers," said a business man who has handled American goods in other years. "It is just possible that some of the cheap stuff—relatively cheap that is—will find its way to New Zealand, but very few buyers are operating for this country in the United States at the present time, "You have got to remember that, if American goods were 30 per cent, cheaper than the corresponding British goods, the adverse exchange and the preferential duty would more than wipe out the advantage. In any case, a temporary fluctuation or slump in one market is not going to reduce prices in other countries to any material extent. An actual decline'in world values is required to reduce New Zealand prices." The reports and quotations that are reaching Wellington importers from the United Kingdom convey no suggestion of reduced prices, but a reporter who made inquiries among retailers in the city gathered that prices have eased in some directions. Men's suits, for example, are a little cheaper. Some common goods, such as laces, are down a trifle. Boots and shoes have not advanced to the extent that was anticipated a month or two ago. But it appears that the reductions, where they have occurred, have not been the result of reduced importing costs. They are local movements, in which the AntiProfiteering Law, and the growing dislike of the public for excessive prices, have had a part. The ruling of the Board of Trade and of the Anti-Profiteering Tribunal that a "reasonable profit" under the law must be calculated on purchase cost, and not on replacement cost, has had an influence on prices, though its fairness is still disputed by many of the traders.