STERLING DEVALUATION

Manawatu Standard, Volume LXV, Issue 306, 24 November 1945, Page 5

STERLING DEVALUATION

STOCK MARKET RUAIOURS

(Ree. 10.30 a.m.) LONDON, Nov. 23. An interesting feature of the stock markets lias been an outburst of buying of dollar securities on a revived rumour of sterling devaluation in relation to the dollar, leading to sharp increases in securities quoted also in New York, says the Australian Associated Press special correspondent. Banking quarters do not share the Stock Exchange views and see little likelihood of an early change in the pound-dollar relationship, recalling the South African Finance 'Minister’s recent categorical statement on his return from London .'that “the authorities regard the sterling-dollar rate as stable.” City feeling about the prospect of a Washington agreement is by no means unanimous, but hopes of a settlement which would take into account Britain’s pre-Lend-Lease liquidation of external assets or give effect to the late President Roosevelt’s equality of sacrifice principle have been, completely abandoned. ... . The most now hoped for is that Britain will have the barest margin of dollar resources over the next two or three years, and attention consequently is focussed on the possibility of savings in foreign exchange, such as on imported films, which now require remittances of - £18,000,000 sterling ' a year. It would not be surprising if Hollywood films soon joined clothes, food, motor-cars and petrol in the rank’s of rationed goods. V ~. BusinessineiV’s nerves have not been helped by the details of the Government’s nationalisation programme or Dr. Dalton’s forecast of stream-lined statutes giving the Government wide power over investment. The Economist, while agreeing ■ that in directions such , as coalmining and electricity supply there is justification for nationalisation, finds it difficult on balance to feel any confidence that the nationalisation programme will lead to any increaso in the efficiency of .British economy and says it is quite easy to imagine that the opposite might be true.