RECOVERY SHOWN

Ellesmere Guardian, Volume LVI, Issue 39, 17 May 1935, Page 2

RECOVERY SHOWN

marked Improvement in

TRADE.

MANY FAVOURABLE SIGNS

Further steady progress toward normal economic conditions in the Dominion was made during the year ended March 31, says the Government Statistician—principally in the direction of internal adjustments to an external trading situation which had already improved to a marked extent during the previous financial year. A surplus of approximately £1,500,000 in the Consolidated Fund is shown in a preliminary statement recently issued by the Acting-Minis-ter of Finance. Even when allowance is made for important nonrecurring items of revenue, a substantial improvement is revealed in the budgetary position as compared with the previous financial year— when a deficit of £709,278 was recorded.

The past 12 months have witnessed a material lessening in the volume of unemployment, the number of men a charge on the unemployment fund in, March (50,345) being 19 per cent, lower than in the same month last year. EXPORTS AND IMPORTS. Exports during the 12 months end-I ed March 31 were valued at £(.N.Z.) 44,918,180, a decrease of £(N.Z.)1,----124,390, or 2.4 per cent., as compared with the figure for the previous financial year. The exceptionally good prices realised for wool swelled the 1933-34 figures, but the effect on the value of exports of the fall in wool values this year has been counteracted to a large extent by a considerable increase in the value of meat exported. The exceptionally dry weather experienced during this season has not materially affected the volume of exports, the crop-growing districts having suffered moWt from this cause. The value of imports during the past financial year was £(N.Z.)32,----567,785, an increase of £(N.Z.)----6,432,289, or 24.6 per cent, over the total for 1933-34. This expansion in import trade is itself a significant indication of expanding economic activity within the Dominion.

In spite of this increase in the value of imports, external commodity trading during the year just past resulted in an excess of exports valued at £(N.Z r ) 12,350,395. The external trading position is thus still sound, despite the drought conditions and the fall in wool values, the uncertainty as to future marketing prospects being the major disturbingelement at .the moment.

During the financial year 1934-35 the amount of sales tax collected was £2,153,913, as compared with £1,847,----273 in 1933-34—the first complete year for which this tax was in operation. The increase of 16.6 per cent, in the yield from .this tax is a significant indication of greater purchasing power in the hands of the public, since the tax is levied on wholesale sales of commodities, and this indirectly reflects retail buying.

Banking statistics show that the value of fixed deposits has latterly shown some reduction, being £3,436,----662, or 8.6 per cent, lower than was the case at the end of March of last year. The total on March 25 (£36,----466,457) is still, however, considerably higher than normal. The value of funds on current account is at present abnormally high, the total on March 25 (£25,209,461) being greater than would be accounted for by either the seasonal influences tending to relatively high figures in March or to the cqnsequences of the upward trend in business activity. It would appear that, owing to the plenitude of funds awaiting investment, the transfer of surplus funds from current account to profit-earning investments takes place more slowly than is normal. THE INVESTMENT MARKET. Other evidences of ample funds! awaiting investment are the progressively falling yield in Government jsecurities and the relatively high' level of share prices. During the financial year ended March 31, the amount of mortgages registered was £12,058,690, as compared with £8,038,727 in 1933-34. Although a sharp increase is thus revealed by the 1934-35 totals, it should be noted that mortgage registrations are still very considerably below the pre-slump levels, the lowest annual total during the five years ended 1929-30 being £33,200,000 (in 1927----28). while the highest figure during that quinquennium was £47,100,000 (in 1925-26).

The substantial increase between 1933-34 and 1934-35 in the value of registrations points to some improvement in the confidence of the investing public in mortgage investments, part of the ample funds awaiting investment now moving to this class of

security. Despite this increase, registrations of discharges exceeded those of new mortgages for the second year in succession, discharges registered during the financial year 1934-35 representing a total amount of £13,762,535, as compared with £13,086,847 in 1933-34.