MONEY MARKET

Hawera Star, Volume XLVII, 19 December 1927, Page 5

MONEY MARKET

SATISFACTORY CONDITIONS. BUTTER STILL DULL, REDUCED PRICES SUGGESTED RY C A BLR —PRESS ASSOCIATION —COPYRIGHT. Received 9.55 a.m. to-day. LONDON, Dec. 17. The Stock Exchange is ending the year in a- most satisfactory manner, for considerable animation prevails in most markets, with gilt-edges leading the way. Activity in these has been; ‘more notable tlian for a long. time. Prices have improved all round and the recent new issues show; strength. The unexpected appearance of the Now South, Wales seven millions Joan gave only* a temporary check ’and its reception was favourable. As ope financial writer says: “It is significant that the under - writing of this loan was easily arranged, as evidently those accepting responsibility believe that even if they are left with a portion, it will not be necessary to nunse the script for long.” In this connection it may be pointed out- that within the last two months the Dominions and British Government loans amounting to £35,000,-000 have been issued in London. Some, like the Commonwealth, were left largely in the Underwriters’ hands! others were fully subscribed, but with only'one exception all these are now quoted at premium. Commenting on this, one oif the leading stockbrokers said: “There is plenty of money here for the Dominions.” Many new issues are talked about, as being likely at the new year, hut Australia’s wants seem to be satisfied for the present. There is unlikely to be any- difficulty in placing them, for it is generally expected that money will be cheaper soon -after the year has turned. Soane rather acid comment comes from tlie “Investors’ Chronicle,” which points out that the New South Wales loan brings Australia’s borrowing during the current year to nearly" £57,750,000 of which £35,000,000 represents new money-. imports for the year ended June 30 exceeded exports by £20,006,000. This largely was a reflection on overseas borrowing. This excess gives cause for concern. Another consequence of overborrowing is that prices and wages are inflated. The large imports, owing to the tariff, have greatly augmented the customs revenue and this has enabled aireel taxation to be reduced. This causes some to think that Australia is more prosperous than the facts justify.” BUTTER AIARKET DULL.

Hopes recently prevalent of an improvement in the butter market have not been realised. Trade has been phenomiually dull with falling prices Why this should be, the experts cannot explain, for the statistical position seems satisfactory. One reason advanced is that invisable stocks (term used tor retainers’ hoidmgs) are larger than they were believed to be. Certainly the retailers have been holding off tor some time, so apparently they had enough to go on with. Yesteruay’s official report states that there was more inquiry at reduced ixrices, and as the retail price has been lowered to Is 8d per pound, there seems to be some ground for anticipating better trade soon. THE WOOL ROTATION. Commenting on the wool position an “Economist’s” correspondent writes: “From what has been seen in London, there is no indication of any setback in values in the near future. The policy should now be one of consolidation rather than any attempt to push prices nigher. During the next month the big weight of direct imports' will be arriving and in view of the drain upon financial resources involved in lifting all this wooi, we think that for the present, values of both merinos and crossbreds are high enough. Users in the consuming centres have found that it has been impossible to hand forward to ultimate consumer the last rise.”