EXCHANGE PROP.

Auckland Star, Volume LXV, Issue 69, 22 March 1934, Page 9

EXCHANGE PROP.

SUPPORT FOR PRICES. HELPING PRODUCERS. FACTORS GOVERNING RATE. (By Telegraph.—Special to " Star.") WELLINGTON, this day. The statements recently made by the Prime Minister and the Minister of Finance reaffirming their previous declarations, that the rate of exchange will remain unchanged until the end of the present export season, have raised the question as to whether in May 01* June there is likely to be any reduction. Though it has not been possible this week to secure any amplification of their statements from either Minister, the impression prevailing officially is that, although l the high exchange may be due for review at the date indicated, no change is intended.

The rate has long since ceased to depend on the factors of trade and the national balance, and lias become essentially a political matter. Undef these circumstances, the depressed condition of the overseas dairy market will operate heavily in favour of maintaining the high rate of exchange. It is already regarded as a financially impossible feat to load the Budget with the liability involved in a subsidy on butterfat production, so that the Government, when it announces a negative decision on this point, will, it is thought, desire to have the exchange maintained as one substantial benefit to hard-pressed producers

As a revival of the rumours of changes tends to create a feeling of uncertainty in the minds of business people, particularly importers, an official statement confirming the views suggested may be anticipated at an early date.