STAGNATION SETS IN

Manawatu Times, Volume LV, Issue 7044, 31 December 1932, Page 7

STAGNATION SETS IN

Trade Crisis in South Africa DUE TO CHANGE IN MARKETING OF GOLD .United Press Association—By Electric ■Telegraph—Copyright. CAPETOWN, Dec. 29. Utter chaoa prevailed to-day in banking and commercial circles. The Reserve Bank, which fixes the rates, announced this morning that all the rates had been cancelled, while the Post Office continued to issue money orders at 40 per cent., with a limit of £IOO. Long queues formed, and the offices were crowded at noon, when a peremptory order was issued confining business to the Union and the Protectorates. Complete stagnation of trade ensued.

The crisis is due to the Reserve Bank refusing the Commercial -Bank’s cover overseas, owing to the automatic termination of the purchase of the gold output at the old standard rate. Pending an arrangement for marketing the output being discussed, the unsatisfactory banking position will continue. Party Before Country HERTZOG GOVERNMENT MAY CONTINUE IN OFFICE. CAPETOWN, Dec. 29. Judge Roos declared emphatically to-day that if General Smuts continues to put party before country, the present Government will continue. NO FIGURES QUOTED. EXCHANGE RATES OPE. British Official Wireless. RUGBY, Dec. 29. A development in the South African inancial situation occurred to-day .when the Reserve Bank cancelled all exchange rates and no figures wero guoted. According to a Pretoria message the banks throughout the country and the Post Offices were Unable to undertake the dispatch of further moneys overseas. The interest which is aroused in financial circles in London by the suspension of the convertibility of South African Reserve Bank notes continues and events are being, watched closely. Although no change was made in the (nominal rates of exchange between South Africa and London yesterday, business was confined to very small transactions. At the close of the Stock Exchange to-night South African mining shares remained on the weak side, awaiting further news regarding tho exchange position.