WELCOME MOVE

Hawera Star, Volume XLVI, 23 April 1927, Page 5

WELCOME MOVE

BANK RATE REDUCED. FIRST TIME SINCE 1925. STOCK OF GOLD INCREASED. (British Official Wireless.) RUGBY, April 21. The announcement that the bank rate had been lowered from live to 4% per cent, was cheered' on the Stock Exchange when it was posted up today. The rate had stood at 5 per cent, since December, 1925. Financial circles have been confidently expecting an early reduction. The stock of gold held by the Bank of England is now only about £2,000,009 less than it was before the country returned to the gold standard two years ago, and it is still flowing in. It was generally anticipated that the bank directors, when they lowered the rate, would act with their ustial caution by taking off only one half per cent. A cut in the rate from 5 to 44 per cent has not been made in one stroke since 1908, although in that period there have been enormous redue tions from 5 to 4 per cent, by way of 4J per cent. BY CABLE—PRESS ASSOCIATION—COPYRIGHT. LONDON, April 21. “The Times,” in a leader, says the bank rate reduction is the most welcome movement of recent years. The reduction is the first definite indication of the effects of the coal strike. This does not mean that the cost thereof has been wholly met, but the monetary sky has been partially cleared and will help to restore Loudon’s attraction as an international monetary credit. For the present, however, London will be unable to satisfy all foreign borrowers. America must for some time remain the principal source of supply.