GOLD REVALUATION

Greymouth Evening Star, 4 February 1939, Page 7

GOLD REVALUATION

NEW BILL’S PROVISIONS.

[BRITISH OFFICIAL WIRELESS]

RUGBY, February 2

Gold mining shares rose on the London Stock Exchange to-day, following the issue of the Government’s Bill amending the Currency and Bank notes Act, as a result of which the gold holdings of the Bank of England will be calculated at the market price.

This step was foreseen at the time of the Treasury’s announcement on the fiduciary issue early last month, but the other proposals contained in the Bill have taken the public by surprise, and they are generally regarded as constituting an important stage in the development of the British monetary system. The Bill provides that the bank’s gold reserve and the other assets, of the issue department shall be subject to revaluation weekly at the current prices and that any difference between this valuation and the note circulation shall be adjusted by movements of gold between the bank and the exchange equalisation account. The Bill will also reduce the fiduciary issue so recently increased to £400,000,000 from £3,000,000. The value of the measure is assumed to be to introduce greater flexibility into the “management" of the national monetary system of which the British authorities now have very considerable experience and the comment of financial writers is generally favourable.