INDUSTRIAL AND COMMERCIAL ITEMS.
THF WHEAT AND MONEY MARKETS. The great controlling factor in the money markets of the world for sometime to come (says the Argus of the 14th inst.) will be wheat. The aggregate of the harvests is about 2400 millions of bushels, and this quantity will probably mean a total ot 400 to 500 millions sterling to the producers. The magnitude of the article would, how ever, not matter much if the distribution were even, but the disturbing element is that while the European yield is showing a ■great falling off, in consequence of remarkably stormy weather at the wrong time, the American crop is a really brilliant one, affording an exportable surplus of at least 200 millions of bushels. We have already, on several occasions forecasted tho position and our views are now confirmed by the statement cabled from London that the American railways running West to East are now blocked by the vast quantities of new wheat en route for Europe. Not only the American railway services, but the British shipping service is drawn upon, for it is stated that enormous numbers of British vessels have been engaged to load for Europe. Wo are thne on the eve of a gigantic Transatlantic movement from West to East, involving a great demand for gold for shipment to America. But the only open gold market of the world, viz., London, ia hardly strong enough to bear the impending strain without the aid obtained by an advance in discount rates. The Banks of France, Germany, Russia, and Austria, although holding vast accumulations of specie, will discourage the exportation of gold by all the means in their power, and the brunt of the demand will therefore fall upon England, who, in her turn, is able to extract gold from her debtors, including the colonies. Hence the outlook is a somewhat dear money market fer some time to come, and a continuous drain on the Australasian gold production. About the same time that we first indicated what waa possible, the London Times July 9tU wrote :—" The probability of dearor money in the autumn is already being foreseen, attention being given to the fact that the Bank's reserve is not nearly as strong as it was a year ago, bo that any demand for gold that arises will produce an appreciable effect on it later." The effect is now being felt, for during the past week the open market rate for the discount of three months' Bank bills has risen from 13.16 to 1 7.16 per cent. This rise is probably a precursor of an advance in the Bank of England rate. It has already depressed Consols, which are quoted at £ less than a week ago. Colonial Government securities, on the average, show no alteration, but the quotations at this season of the year have to be regarded as almost nominal.
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Press, Volume LIV, Issue 9817, 28 August 1897, Page 7
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480INDUSTRIAL AND COMMERCIAL ITEMS. Press, Volume LIV, Issue 9817, 28 August 1897, Page 7
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