“BREATHING SPELL IN INFLATION”

Press, Volume LXXXIX, Issue 27096, 20 July 1953, Page 13

“BREATHING SPELL IN INFLATION”

RETURN OF CONFIDENCE A return of confidence in business and a “breathing spell in inflation’’ are seen by Mr D. McL. Wallace, managingdirector of D. McL. Wallace, Ltd., general engineers, motor body builders and farm machinery manufacturers, Auckland. It seemed, said Mr Wallace, iri his annual address to shareholders that the financial year just completed marked the end of the period of uncertainty in business circles which had existed from late 1951 to early 1953.

"This period of uncertainty," he said, “was brought about by the flood of imports which entered the country, bank credit restrictions, the tightening of investment moneys generally, instability of interest rates and the relaxation of import control.

“Within the last few months, however a feeling of confidence has returned—a confidence based on the realisation that there is a ready market for all goods and services which are economically produced and can stand up to reasonable competition.

"The period that has passed ha* resulted In a certain amount of shaking down in values, keener buying, keener tendering for contracts, a concerted effort to put more value into good* for the price asked, and a genuine effort by both business and trade unions to hold down cofits.

"In other words, inflation has taken a breathing spell, which should be all to the good, both for the consumer and the investor. Further capital expenditure will probably be on a sounder basis than in the previous period."