PURCHASE OF SILVER

Evening Star, Issue 22920, 30 March 1938, Page 11

PURCHASE OF SILVER

UNITED STATES AND MEXICAN AGREEMENT ABRdGATION ANNOUNCED Pres* Association—By Telegraph—Copyright NEW YORK, March 27. Mr H. Morgenthau (Secretary of the Treasury)' officially announced the abrogation of the agreement to. purchase Mexican silver. He declined either to confirm .or deny that it resulted from the oil expropriation decree says the Washington correspondent of the United Press. The agreement will terminate on April 1. • The Treasury declined to discuss the matter, saying that, a formal announcement may be expected to-morrow. The silver agreement has been effective since January 1. It was the major factor in maintaining the stability of Mexico’s currency. Officials pointed out that the United States made the : agreement strictly on a “ favour basis,” Mr Hull believing it was the largest Single contribution to the good neighbour policy. The action is hot expected to have an immediate serious effect in Mexico, although it might force it to turn to London and the world market. It is believed possible that large-scale Mexican offerings might unsettle the market and depress the price. There is a possibility that the United States will increase its - silver purchases from Canada, which at present are 1,200,0000 z a month under the agreement. ,

SHARP DECLINE IN PRICE POSSIBLE EMBARGO IN LONDON. LONDON, March 29. (Received March 30, at 11 a.m.) Silver burst dramatically into the limelight with a. sharp decline. It is expected that the United States’s decision to terminate Mexican purchases will ditert Mexican silver to London, where the marketing is likely to encounter considerable difficulty. The Australian Associated Press understands that moves are already afoot to institute an embargo on it. as a gesture of approval of United States action.