BANK RATE REDUCED

Hawera Star, Volume LI, 20 February 1932, Page 5

BANK RATE REDUCED

DECISION AT LONDON LOWERED TO FIVE PER CENT. WIDESPREAD SATISFACTION. INDICATION OF IMPROVEMENT. t Grated Prew* Aaxiciatiun—By Klecvrro iolegraph Copyright.) LONDON. Feb. IS. The bank rate has been reduced Lorn 6 per cent to 5 per cent. The reduction is hailed with widespread satisfaction. It is considered, in conjunction with the repayment of French and American credits, as an indication of a welcome improvement in the international financial position.

The Rank of England rate of discount was G per cent, to which it was increased on September 21 from 4) per cent. This week short loans were quoted at 5 per cent, compared with 4a per cent last week. The market rate of discount for best three months bills was 5a per cent, as compared with 5 per cent last week.

STOCK EXCHANGE RESPONSE.

RUGBY, Feb. 18. The reduction in the bank rate from 6 to 5 per cent has had a stimulating effect in the city and on the stock exchange. It is the first reduction since Britain left the goto standard five months ago. The change came as a pleasant surprise, and business received an immediate stimulus, while stock prices generally were marked up. The outstanding feature at the close of the exchange was the substantial gams registered by all leading gilt-edged specialities.' These included war loan 5 per cents., which rose f to 995, the funding loan of 4 per cent, which rose 1 *3-8 to 88 5-8, and the consolidated 4 per cents., which rose 1 3-8 to 86 3-8. ~ . , Mr Walter Rumanian, president of the Board of Trade, speaking at*n Chamber of Shipping dinner, said he had heard of a reduction in the bank rate, which would afford relief far exceeding a I per cent. drop, especially regarding industry generally and taxpayers who had borrowed to pay tlieir taxes.