MONEY PLENTIFUL.

Auckland Star, Volume LXXI, Issue 17, 20 January 1940, Page 4

MONEY PLENTIFUL.

BRITISH INVESTORS. CONVERSION LOAN EFFECTS. LOWER BANK RATE EXPECTED. British Oflicinl Wireless. (Kocoiretl 3,1 a.m.) RUGBY, January 10. The markets generally reacted favourably yesterday to the terms of the new 2 per cent conversion loan of £375,445,077. The improvement in Government stocks was marked, war loans advancing from £9.1 17/G to £07. Many believe that the conversion operation foreshadows an early reduction in the bank rate to IV-j per cent. Applications for treasury bills to-day reached the highest peak ever recorded, this being evidence that there is .plenty of money awaiting short term investment. Tenders for the offering of £<*>,000,000 amounted •to £ 122.000,000. The average rate of interest is the lowest since August IS. Gilt-edged securities responded immediately to the conversion operation, the net gains in (funds ranging upwards two points, with -war loans reaching £07 10/. However, the pace proved too fast and •profit-taking caused a reaction. An all-round rise occurred in Dominions and coloi ials. after an earlier reaction as a result of the European tension. A still (further improvement is confidently expected.