Low Interest Rates

Manawatu Times, Volume 61, Issue 1423, 19 June 1936, Page 6

Low Interest Rates

Australia seems to have set an example to New Zealand m the matter of loan conversion, having set a new' low level of interest for a Dominion loan in London. By raising £16,550,000 at a lower rate than 3 per cent- the Commonwealth has eclipsed New Zealand’s best effort, and brings to an end a remarkable series of conversion operations. In less than four years Australia has dealt with £198,500,000 of her overseas debt in such a manner as to save in annual interest and exchange £3,979,000. The whole of the operations have been arranged through the financial capacity and prestige of the Australian High Commissioner, Mr. Stanley Bruce. In the same period New Zealand conversions or inpayments in London have aggiegated only £25,000,000.

It so happened that the maturity dates of large Australian loans presented the opportunity of converting in these years of abnormally cheap money, whereas the opportunities offered to New Zealand were few and comparatively small. The British Government at the outset adopted a sympathetic attitude towards Australia at a time when an embargo on external lending to foreign nations placed the Australians in a particularly favourable position. New Zealand was, of course, privileged to share equally in these advantages as far as her contracts allowed, that is, within the limit of voluntary conversion.