MONETARY OUTLOOK

Evening Post, Volume CXII, Issue 11, 13 July 1931, Page 12

MONETARY OUTLOOK

POSITION IN LONDON

(United Press Association—By Electric Tele- , jraph—Copyright.) LONDON, 11th July. ; The confident hopes entertained a fortnight ago for the early reduction in the bank rate have not been fulfilled, for, although the French Chamber has agreed to President Hoover's moratorium proposal, Germany's financial troubles have beepme so acute that the Bank of England has had no option but to act cautiously and postpone the much-desire 1 reduction until the situation in Germany improves.

The bank's position is extraordinarily strong, its gold reserve being nearly £166,000,000, and further sums are in sight which are likely to raise it to the high record total of £175,000,000 before the autumn. .

The failure to reduce the bank rate had a depressing effect on the Stock Exchange, and countera"cted the good impression caused' by the moratorium arrangement. The depression is accentuated by the German financial crisis and alarmist reports that the latter might seriously affect some London and Continental financial houses.

As a consequence, gilt-edged stocks here had a slight set-back, but the Australians maintained their position "on the continued progress made toward financial reconstruction," as "Statist" puts it. Dominion stocks* generally showed a firm market.