EXCHANGE PROBLEMS.

Auckland Star, Volume LXII, Issue 87, 14 April 1931, Page 8

EXCHANGE PROBLEMS.

N.Z. AND AUSTRALIA. VISIBLE TttADE BALANCES. (By Telegraph.— Parliamentary Reporter.) WELLINGTON, Monday. The intricacies of the exchange pro- . blem were referred to in the House this I afternoon by Colonel T. W. McDonald (United, Wairarapa), who asked the Prime Minister whether it was a fact ' that a considerable portion of the visible trade balances of the Dominion in favour I of New Zealand were being used to assist Australian exchange. The member pointed out that during the last ten j years the favourable trade balances of. New Zealand had amounted to j £40.000,000, vet there was an adverse exchange rate of 10 per cent operating between the Dominion and England. | •'lt is considered that directly and indirectly conditions in Australia, and the very high rates of exchange uetween the Commonwealth and London are important factors in determining the rate of , exchange between New Zealand and London." admitted the Prime Minister. "But the Government is not in a position to say to what extent London funds " derived by banks from New Zealand business have beeu used to support the Australian London exchange, but it should be understood that invisible items have also to be taken into account. An overhaul of the banking system is under consideration, and an expert report on the question is being obtained from Sir Otto Niemeyer."