MONEY RATES.

Auckland Star, Volume LIV, Issue 267, 8 November 1923, Page 4

MONEY RATES.

Yesterday's message stating that the New South Wales Government has raised the rate for stock sold over the counter from 5$ to 5j per cent re-directs attention to the demand for money in Australia, and the fact tlrat rates arc higher there than in New Zealand. Victoria, New South Wales, South Australia, and West Australia have been offering stock for sale at 5i per cent, and in Queensland the rate offered has been 5J per cent, whereas New Zealand stock is on sale by the Government at 5. Moreover, all these Australian issues are free of both Federal and State income taxes. The "Banking Record" draws attention to the increased demand for money from the banks, as revealed by the banking returns. "According to the understanding recently arrived at between the Commonwealth and the States." it explains, "the issue of tax-free securities is to cease at the end of the year, but in the meantime the Governments are pressing for money at a time when the active requirements of the wool season have to be met." This suggests that the rise in the New South Wales rate is due to temporary causes, but against this is the certainty that Government requirements throughout Australia will be heavy for I an indefinite period. If interest rates in Australia remain higher than in New Zealand, a flow of capital from this country to Australia is certain.