INCREASED NOTE CIRCULATION

Press, Volume LXXXVII, Issue 26477, 19 July 1951, Page 6

INCREASED NOTE CIRCULATION

HIGHEST IN RESERVIj BANK’S HISTORY I ' REPORT ASSESSES CAUSED (From Our Own Reporter) WELLINGTON, July idjl According to the annual report « I the Reserve Bank, the net note c®?;® culation in the last week of Marieaß was £48,098,941, or £3,797,078 than the corresponding figure for 19WS| The report says that the increase mMI note circulation was accounted for part by higher prices, wages, salariM’O and other incomes, and in part by continued growth of population, dustry, and trade, ..Tp e present note circulation is highest in the history of the Reserve’ J Bank. In 1941 it was £17,162,000. Thlja increase in the note circulation tM ’3 year of £3,797.078 was the greataM| 1? 44, wh en the increase was ■'l £5,021,000. , .Vp der the heading of demand lla* ;’» bilities, the report says that State <•* posits totalled £40,062,159—an increase "3 of £6,760,043 over the previous yser. ~;;s Deposits from trading bank* amounted'' J to £48,125.202. or £19,270,218 less then 1 a year ago. The report explain* that. 1 the decline in this item is related W 3 an excess of Government receipts oter , B payments during the year, and an Msociated decrease in Reserve Bank 3 credit.

.. Onthe assets side, the report show* that Reserve Bank holdings of sterling rose by £14.726.449 during th* y**». This increase mainly resulted from decreased sales of sterling to trading banks. Advances to the State showed a decrease. Advances to marketing organIsaUons were £7,474,268, comptfed with £7.450.388 in the previous ye*r. rhe monthly average of advances for was £4.850.000, again* £6.600,000 in the previous year. Ad" vances to the State for other purpo*** fell by £3.000.000 to £50.000,000. Discussing loans to foreign Governments, the report says that the C«*ch Government has continued to draw on of £¥Zl.OOO.OOO granted » 1948 to finance 'he purchase of New Zealand wool, a credit of £5.000, V* sterling extended to the French Government in 1947 for the same purpoae, wa ? virtually exhausted before th* end of the 1049-50 year. ' By March 31, 1951. drawings by «««<-»»“• ““** According to the report, the balance in the Wool Retention Account on March 31 was £6,771.995.