AUSTRALIAN FINANCE

Manawatu Standard, Volume LII, Issue 176, 27 June 1932, Page 10

AUSTRALIAN FINANCE

A BANKING REVIEW. The monthly summary of Australian conditions for April issued by the JNational Bank of Australasia notes that the broad general conditions of Australian affairs have not changed materially during the month under review. Our dominant need, a material rise in world prices of our mam export commodities, appears no nearer, it says. The process of adjusting our internal economy continues, but the movement is relatively slow, anil advancement has been checked by the failure of the State of New South Wales to adjust its public finances in keeping with the economy plan adopted by the Premiers’ Conference m June last and by various legislative and social restrictions which are retarding the restoration of economic equilibrium. The political atmosphere has been more disturbed during the past month than since the last federal election. In New South Wales, the dissension between the Federal and State Governments with regard to the recoupment of interest on the State debt paid by the central authority has had disturbing reactions on business enterprise. [Since the foregoing was published the Bang Government has been dismissed.J In V ictoria, the defeat of the Labour Government and a consequent election to be held on May 14th, while not so unsettling as the anomalous condition in New South Wales, tends to divert men’s minds from business and to lessen productive effort. TSince the foregoing was written Labour in Victoria has been dismissed from office and a national ministry f factors are offset by excellent seasonal conditions and by the influence on current affairs ot the many adjustments of effort, income, and expenditure made since the beginning of the depression. Also, the great part of the people is growing accustomed to the altered conditions, and a new confidence is being engendered by the relative stability of the Pfl It of mention that, apart from the suspension of payments by the State Savings Bank of New South Wales (and it has ben taken over since and its depositors’ balances assured by the Commonwealth Bank) there have been but few major failures among the large producing, trading, and financial houses’ of Australia. When the rapidity and extent of the collapse of prices and the depth of the world depression are given due consideration, it would appear that the proved strength of our business structure provides grounds for confidence in its ability to carry through the present abnormal conditions'. OVERSEAS TRADE. Another indication of strength is provided by the returns of oversea trade for the nine months ended March. They show the recorded value of merchandise exports for the period at £73,338,000, equal in sterling to £57,361,000. When shipments of gold are added, the favourable trade balance —on a sterling basis—is £30,659,000 for the nine months'. This compares with £16,135,000 sterling—favourable—for the previous relative period, and £9,100,000 unfavourable for the nine months ended March, 1930. it is regrettable that imports have had to be contracted from £107,000,000 to £32,000,000 in the process. The recorded value of exports for the nine months is £18,000,000 less than for the 192930 period, but on a quantity basis a substantial increase has been achieved. With another year of high rural production in prospect, largo export surpluses may again b© looked for. A rc latively small increase in prices woulc be very useful. Banking statistics for the quarter ended March show average .deposits held by the trading banks at £282,000,000, and advances and securities at £268,000,000. Compared with the averages for the March quarter of 1931, deposits are £19,000,000 higher, advances are lower by £19,000,000, while investments show an increase of £lB,000,000. Holdings of Australian notes and balances at the central bank, at £51,000,000, are some £4,000,000 above the figure for the previous March quarter Savings Bank deposits totalled 193,500,000 on March 31st, which, though a million less than at the beginning of the year, is still slightly above the total of June 30th last.