IMPORTATION OF GOLD.

New Zealand Herald, Volume LXII, Issue 18942, 13 February 1925, Page 6

IMPORTATION OF GOLD.

AUSTRALIA FROM AMERICA. LARGE SUMS INVOLVED. A LEADING BANKER'S VIEW. [rnojt our own copbbspoxoknt.] SYDNEY. Feb. 4. There is much talk in financial circles about large quantities of gold which are being "transferred 'from America to Aus- : tralia through private banks on behalf of I certain wheat dealers, and somo prominent financiers have forecasted an early return to gold currency. The attitude of the Commonwealth Treasury is that it will raise no impediment to the importation and use of American gold, which those concerned say will facilitate exchange transactions and reduce their costs. The Treasury is leaving the matter entirely to> the trading banks and their clients. The Commonwealth Bank, !it is explained, has no intention of following the lead of those trading banks. An interesting interview on the situation has been given by a prominent banker. He said that few banking authorities would agree with the statement recently made by Mr. J. J. Garyan. chairman of the Commonwealth Bank, that there was no need to add to Australia's gold reserves. "During the war," said the banker, "the banks lent £10,000,000 in gold to the Commonwealth Government, largely as a basis for the Federal note issue, and when this sum is repaid it may bo necessary for the Commonwealth to replace it by acquisition from other sources. In addition to this the banks, during the war, provided £5,000,000 in sovereigns for the purposes of the British Government, and as these institutions have for many years been unable to add to their stocks of gold from local sources owing to the produce of the mines being largely sold abroad it may be assumed that they desire to strengthen their holdings. It would appear likely that a flow of cold may set in to tho Commonwealth from America, increasing supplies here in readiness for a return to free circulation of gold as soon as the Government and the banks consider that a suitable time for such reversion has arrived. The cost of bringing surplus funds from London 'to Australia i 3 now so great that, with reasonable shipping charges it would probably cost less to bring eold from New York or San Francisco than from London through the usual evchansre channels. It is not thought likely that as much gold will be required for public circulation purposes as before the war, as Commonwealth notes have become firmlv established in public favour for pocket and petty cash purposes. One of the most .important effects of the inflow from America will be to ease the present onerous exchange situation bpween London and Australia. This will bo a great advantage to the exporting interests of Australia."