RAW COTTON DEARER FOR BRITAIN

Grey River Argus, 27 September 1949, Page 5

RAW COTTON DEARER FOR BRITAIN

Foreign Balances At London Not To Be Devalued LONDON, September 25 Stability in American raw cotten prices, after a record run of 19 weeks without a change, has been abruptly ended by the devaluation of the pound. The Raw Cotton Commission today authorised increases from tomorrow ranging from three-eighths of a penny to 3d per pound.

This will cause shirts, sheets, dresses, and curtaining to be dearer in the shops early next year. The windfall on Argentina’s holding in sterling, which has to be written up because of devaluation, the increased cost of her meat exports to Britain during the next four months and the increased cost of dollar wheat, are not the only such burdens that devaluation has imposed on Britain, says Reuter’s financial editor. Guarantees similar to those granted to Argentina were given on the sterling balances of Portugal and Persia. They are estimated at £70,000,000 and £40,000,000. The extra lump of £17,500,000 to Persia less serious than the additional burden of £10,000,000 each year, which devaluation is likely to impose on the current costs of the Anglo- Iranian Oil Company, in which -the British Government is a majority owner. The British United Press Correspondent says: New economic moves were made againts Pakistan today, following Pakistan’s refusal to devalue the rupee. This refusal is virtually appreciating it nearly forty per cent, against the Indian rupee. The Indians have decided to suspend all imports from Pakistan from tomorrow except fish and milk products, poultry, and fresh vegetables. The Indians have* also suspended a number of Postal Services.

In Italy the lira and Italian stocks and bonds are still ho.-di:i" relatively steady in the o n en market operations. The Communist leaders, however, are demanding a Government suue ment on whether Italy will revr.lm. its currency.

As a result of sterling devaluation 3,000 tons of canned and dried, fruits and nuts fo rexoort to Britain are held up at Naples. Export circles suggest that these blocked goods may be diverted to America and other countries .in the dollar area.