THE MONEY MARKET.

Auckland Star, Volume LIX, Issue 124, 28 May 1928, Page 4

THE MONEY MARKET.

NEW ZEALAND GOLD SHIPMENTS.

With respect to the' recent gold shipto Australia made by the Bank of New Zealand, regarding which there were many anxious inquiries, the "Argun" (Melbourne) says that "In some quarters the opinion is expressed that the money has been shipped to adjust the trade balance between Australia and the Dominion, as it lias an excess of imports from the Commonwealth against the New Zealand exports to Australia." Generally, exchange arrangements of the kind have been largely settled in London. The Bank of New Zealand, however, has previously found it expedient to have extensive investments in Australia, and they have decreased or expanded according to trade requirements, or as funds may have been wanted in the Dominion. The returns of the Bank of New Zealand disclose that it has a holding of coin and bullion of about £3,500,000, or practically £ for £ aaginst its note issue. This is an exceptional ratio, and in view of the generally improved trade and finance within the Dominion, it is not improbable that the management has new decided to make a portion of its stock in gold interest bearing. Opportunities for doing so are greater in Australia than in the Dominion, and if the gold were wanted in New Zealand at any moment, investments in Australia could be quickly realised, and the funds transferred to the Dominion. THE LATEST DOLLAR LOAN. Analysing the particulars of the 50,000000 dollars loan recently raised in New York by the Australian Loan Council, J. B. Were and Son, Melbourne brokers, state that the return to the investor based upon redemption at maturity is 5 per cent. This is much better terms than Australia has secured of late and is within 1/ per cent of the terms secured for New Zealand's last London loan. Actually, New Zealand's loan was more favourable than 1/ per cent, because the difference between the cost of raising loans in London and New York is from one to one and a-quarter per cent cheaper in London than in America. MELBOURNE CITY LOAN. city of Melbourne is raising a loan for £500,000 by debentures bearing 5% per cent interest and due for repayment in 1944. The loan is being issued at par.