BRITISH TRADE SUMMARY

Evening Star, Issue 22413, 10 August 1936, Page 10

BRITISH TRADE SUMMARY

INFLUENCE OF SPANISH WAR APPREHENSION NOW FELT INTERNATIONAL MONEY MARKETS AFFECTED Press Association—By Telegraph—Copyright LONDON, August 9. (Received August 10, at 12.15 p.m.) The City, which was at first inclined to ignore the Spanish situation, is now becoming apprehensive of possible international complications. The presence of German warships and Signor Mussolini’s chilly attitude to the French Note are considered ominous. Heavy sales of francs and the marking down of German bonds reflected the nervous-* ness, which has spread to most home securities. RECORD NOTE ISSUE. The Bank of England note issue reached a new record of £454,400,000, making an increase of £42,600,000 on the year. Only a small proportion of it is attributed to the improvement in industry. At least three-qparters disappeared and has. become immobilised in the form of Continental hoards. The bank return also throws a light on the authorities’ determination to continue cheap money, although recent gold purchases fully offset the deflationary effects of the huge note efflux. The authorities are continuing .to reduce security holdings, indicating that they have resolved to maintain credit on an even keel.

NEW ZEALAND EXPERIMENTS. The 1 Economist ’ comments on Mr Savage’s experiments, stating that it is ono of the advantages of democracy to be able to indulge in the luxury of a reformist Government during prosperity and return to discipline and convervatism during a depression.- Mr Savage’s Government is engaged in the distribution of the fruits of recovery the conservative National Government secured. Mr Savage’s Budget is an orthodox recovery one, enlivened' with a dash of distributive taxation. Provided recovery continues, as seems probable, the modest increase in direct taxation should be bearable. Guaranted prices for butter and cheese were evidently fixed with great caution. The success of the Government’s, policy wholly depends on the maintenance of the price of New Zealand exports. As long as the world recovery maintains tb«M prices New Zealand’s reformist experiment will continue under most favourable conditions. WHEAT. Wheat enjoyed an active week, exceptionally large trade being done in futures, but buyers were quick to take profits. . , - ■ ZINC. There was little interest in other commodities, with the exception of zinc, which slumped heavily on reports, that the Cartel negotiations had broken down. The Spanish trouble probably influenced the breakdown. There is no hope of an immediate resumption of the negotiations. The next step presumably will be the British producers’ request for a higher tariff. APPLES. There is little doing m apples. BUTTER. Butter is slightly firmer after a quiet, dragging holiday market. Tbs' Continental market will probably have a strong bearing on the future'course of values, as America, with a,big shortage in production, is taking an interest in Dutch, Polish, and other descriptions,and may shortly be a heavy buyer. ARGENTINE AGREEMENT. Britain’s notice to terminate the Argentine agreement on August 7 does not imply that, the .negotiations have reached a deadlock.- Argentine is considering the British- proposals, and has devised an agreement, including a levy of three farthings per pound on Argentine beef, with a guaranteed quota of imports for three years.