RESERVE BANK

Nelson Evening Mail, Volume LXXII, 10 March 1939, Page 7

RESERVE BANK

STERLING EXCHANGE DECREASES DAIRY ADVANCES HIGHER •I United Press Association! I WELLINGTON. This Day. | The sterling exchange funds of the j Reserve Bank of New Zealand on Mon- i day totalled £ N.Z.4.705.897. a decrease I on last week of £ N.Z. 133.658. The j bank’s net overseas funds amount to £ N.Z.4.668.019. The proportion of reserve to notes and other demand liabilities is 25.017 per cent., the lowest figure yet reached. Advances to the Primary Products Marketing Department have risen by a further £429.124 and now total £7.299.716. Advances to the State for “other purposes” have decreased by £75.000 and now stand at £12.725.000. The note issue at £14.810.081 is low-! e by £95,534. State deposits at £6.-j 004.720 show a sharp advance of £l.986.793. while the trading banks’ cash I reserves show an equally sharp decrease of .£1.907.066 lo £8.560.348. ] The statement of assets and liabilities of the Reserve Bank as at the close of , business on Monday. 6lh March, is as j follows: LIABILITIES 1. General Reserve Fund 1.500,000 0 0 2 Bank notes 14.810,081 0 0 3. Demand liabilities—fa) State 6.004.719 19 11 fb) Banks 8.560.348 3 8 (c) Other 484.273 15 0 4. Time deposits 5. Liabilities in currencies other than New Zealand currency 37,878 2 7 6. Other liabilities .... 286.395 3 6 £ (N.Z. >31.683.696 4 8

ASSETS 7. Reserve— £ . s. d. (a) Gold 2.801.791 0 0 1 fb) Sterling exchange * 4.705.896 10 8j 8. Subsidiary coin .... 204.256 4 6 j 9. Discounts — (a) Commercial and agricultural bills j ib) Treasury and | local body bi 115.... 150,000 0 0 I 10. Advances — I <a) To the State or State undertakings 11 ) Primary Products Marketing j Department 7.299,715 15 6 j <2) For other pur- ] poses 12.725,000 0 0 j ib iTo other public authorities *c) Other 11. Investments 3.651.028 6 4 12. Bank; buildings .... 13. Other assets 146,008 7 8| £ (N.Z. >31,683,696 4 3 j * Expressed in New Zealand currency. 1 Proportion of reserve (No. 7 less No. 5) to notes and other demand liabilities, 1 25.017 per cent., compared with 25.799 per cent, on 27th February and 66.019 per cent, on 7th March, 1938. The reserve on Monday amounted to £7.469.810. compared with £7,603.547 on 27tli February, a decrease of £133,- | 737. On 7th March, 1938. the reserve | stood at £18,418.907. j Sterling exchange expressed in New , Zealand currency this week amounts to i £4.705.897. compared with £4.839.555 1 on 27th February, a decrease of £133,i 658. There are liabilities in currencies other than New Zealand currency this j week of £37.878 (an increase of £79), ! thus reducing the net overseas assets lof the Reserve Bank to £4.668.019. A | year ago the overseas assets of the bank i amounted to £15,617,116. | Go I 1 remains unchanged at £2.801.791. Subsidiary coin at £204,256 shows a decrease of £565. Advances to the Primary Products Marketing Department total £7,299.716. y increase of £429,124. Advances to the Stale for “other purposes” show a decrease of £75,000, and now stand at £12,725.000. Investments at £3,651.028 are lower by £144. Other assets at £146,008 show an increase of £29.659. The note issue has decreased by £95.- ’ 534 to £14,810.081, at which figure it is

£1.216.108 in excess of the total of £13.593.973 on 7th March. 1938. Demand liabilities to the State at £6.004.720 show a sharp advance of £l.986.793. The trading banks* reserve balances now total £8.560.248. a sharp decrease of £1.907,066. Other demand labilities amount of £484.274. an increase of £403.069. Other liabilities at £286,395 show an increase of £12.075. The statement balances at £31,683,696. an increase of £399,415. MOVEMENTS IN STERLING EXCHANGE I The movements in the sterling exi change held by the Reserve Bank of j New Zealand during the lust few i months and the decrease in the ratio percentage of reserve to notes and other demand liabilities, are shown in the following table: — Sterling Reserve exchange. ratio £(N.Z.) percent.

' 1937. j Dec. 27 1G.992,743 70.323 1 1938. ! Aug. 29 .. .. 13,695,000 67.2 Sept. 5 .. 12.639,000 65.847 i Sept. 12 .. 12.681.343 GG.423 j Sept. 19 - 12,247.006 63.833 I Sept- 26 .. 11.449.447 60.785 i Oct. 3 10.594.978 57.259 Oct. 10 .. 9.900.233 57.903 . Oct. 17 _ 9.118.330 52 27 ! Oct, 24 8.313,575 48.451 Oct. 31 .. 7,707.697 46.09 : Nov. 7 6,033,031 39.733 Nov. 14 .. 5.662.977 36.825 j Nov. 21 .. 5.029.137 33.723 ! Nov. 28 4.828.302 32.685 Dec. 5 4.200.856 29.834

Dec. 12 4.572,031 30.333 Dee. 19 4,368.095 28.109 Dec. 26 .. 4,678,233 27.882 Jan. 2 4.017,232 26.1.3 Jan. 9 3,933,851 25.526 Jan. 16 .. .. 4,373,105 26.782 Jen. 23 .. 4,395,525 26.695 Jao. 30 4,133.586 25.75 Feb. b 4,0/4,904 25.047 Feb. 13 4.164.499 25 073 Feb. 20 4,523.031 25.378 Feb. 27 4.839.555 25.799 Mar. 6 4.705.897 25.017 The statutory minimum of the reserve 1 ratio is 25 per cent.