LONDON EXCHANGE.

New Zealand Herald, Volume LXI, Issue 18828, 1 October 1924, Page 9

LONDON EXCHANGE.

ALTERATION IN RATES. TRANSFERS TO AUSTRALIA. FURTHER INCREASE ANNOUNCED By Telegraph--Press Association— Copyrisht. (Received 7.30 p.m.) A. and N.Z. LONDON. Sept. 29. The Associated Australian and New Zealand Banks have raised the selling rates for exchange on Australia by 5s per cent. Drafts for mail transfer have been advanced to 52s 6d per ccnt. premium and telegraphic transfers to 60s per cent, premium. The discounts on bills on Australia have also been reduced by 5s per cent The buying rate for sight bills will now be 10s premium ; 3D days, Is 3d discount, 60 days, 12s 6d discount; 90 days, 23s 9d discount. On May 8 the London rates for selling exchange on Australia were increased by 10s per cent., and the buying rates were reduced by 10s. On September 9, similar alterations bv 5s w-pre made. The exchanges for both Australia and New Zealand arc technically " favourable," aud have been steadily moving in that direction, so that Australian and New Zealand currencies are at a premium. Commenting on this situation recently, the Manchester Guardian Commercial drew attention to the apparent anomaly of the Australian pound being at a premium while Australia has to provide £25,000,000 a yea:' to meet its interest bill and Australian imports exceed. exports. " The. trouble is more than seasonal." the writer observes. " Sooner or later Australian financial authorities will be compelled to recognise that a return to the gold standard before the Mother Country is outside the scope of practical politics, and that the most satisfactory way to expand the Australian currency is by the issue of notes against London funds. In. practice it would in all probability be found that no additional notes would be wanted, as the banks knowing that London funds were available and that Australian notes could be obtained in exchange fit any moment, would be able to make better

use of the notes already in existence in Australia. . . . Whatever may be the cause of the present unsatisfactory position, it is essential that action be taken soon if financial chaos during the next exporting season is to be avoided, Moreover, the difficulties to bo faced in the future should easily bo surmounted if only arrangements could be made for the Government, Commonwealth Bank, and the ordinary banks to work in unison in the interests of the general community."