STABLE POUND.

Auckland Star, Volume LXII, Issue 289, 7 December 1931, Page 7

STABLE POUND.

OBSTACLES IN WAY. International Influence on British Attitude. BALANCE OF TBADE FIRST. (United P.A.—Electric Telegraph—Copyright) (Received 10.30 a.m.) LONDON", December 6. The diplomatic correspondent of the "Observer," in reference to the stabilisation of the pound, says that British Ministers told M. Flandin, French Finance Minister, that this could not be effected until three conditions had been fulfilled: — Firstly, British trade balance must be restored.

/ Secondly, the reparations problem must be settled on a permanent basis. , Thirdly, a guarantee must be forthcoming _that international monetary policy will not again be misused as an instrument against the pound if, and when, it is restored to the gold basis.

A Central News message from Paris states that Britain has replied to the French request for negotiations on Customs duties, admitting the principle of amicable conversations, but expressing the opinion that the time is premature. Duties cannot be modified in a moment. Both Governments should therefore await a more favourable opportunity.

"I am speaking of a position unprecedented for many years, when I was unable to deliver the goods myself," said Mr. Stanley Baldwin at Aberdeen. "As a member of the National Government I can only say that I hope I may. be able to do so. It. is not easy for men hithertoantagonistic on many subjects to reach a common agreement.

"It is like a team of international football stars having to learn team work, but we are going to make the team able to play any team in the country." Mr. Baldwin pointed out that the exact figure of the adverse trade balance was not known, but it would probably be about £100,000,000 per year. Until this was rectified the stabilisation of currency was impossible, he said, but the internal value, of the pound was steady, for which the nation had to thank the balancing of the Budget and the confidence of .the people and of the world in the, Government's honesty and good faith. "I am convinced," he stated, "that there is no reason for anxiety at the drop in the value of sterling abroad'. This was due to seasonal reasons,, also the.payment for an unusual amount of imports with which the Government was dealing." TURNING THE CORNER. Stock Exchange View of British Financial Position. USE OF EXCHANGE RATE. (Received 10.30 a.m.) LONDON, December 6.. The reduction in the Australian exchange rate, although welcomed as a move in the right direction, has not altogether satisfied Anglo-Australian commercial men, who maintain that the drop might, advantageously have been greater. They are of the opinion that the uncertainty due to periodic fixations sponsored by the Commonwealth Bank will react more adversely to trade than a declaration of a definitely unvarying rate over a longer period, say six months. They point to the fluctuations _ in sterling, and declare that the operations of two unpredictable factors instead of one will aggravate the difficulties of bill brokers.

Meanwhile, the weakness of sterling has not occasioned as much anxiety as was expected. Financiers are of the opinion that the factors concerned can, if necessary, be corrected by the bold use--of the bank rate along traditional lines. The repeal of the Treasury's ban on forward exchange dealings is expected soon. Stock Exchange opinion, despite disquieting " world conditions, is that Britain's financial position is turning the corner. FRENCH INCENSED. ME. RUNCIMAN'S PLAIN TALK. PARIS, December 6. Most of the newspapers are incensed at Mr. "Walter Runciman's outspoken speech in the House of Commons. They are generally of the opinion that the speech has compromised the success of the Anglo-French trade negotiations. It is even a question whether it is wor:h while sending a French delegation. FULL OF HOPE. GANDHI LEAVES FOR INDIA. (British Official Wireless.) RUGBY, December 6. " Many prominent Indian delegates to the Round Table Conference are returnin<>- home during the next * few days. Before departing, they are making farewell calls on the Prime Minister and other Ministers with whom they have been so closely- associated during the last few weeks. ' Among those" who had an interview of this character with the Prime Minister was Gandhi. Before leaving, Gandhi said it had been well worth while coming to England. He was leaving full of hope for India.