FRENCH PANIC CEASING.

New Zealand Herald, Volume LXIII, Issue 19390, 27 July 1926, Page 9

FRENCH PANIC CEASING.

CONFIDENCE IN POINCARE. FINANCIAL RECONSTRUCTION INTENTIONS OF GOVERNMENT. NO FURTHER INFLATION. By Telegraph— Press Association— Copyright, (Received 5.5 p.m.) A. and N.Z.-Reuter. PARIS. July 26. Now that M. Poincare, the new Premier and Finance Minister, is at the helm the run upon the French banks has ceased. His very presence at the bedside of the sick franc has allayed the fever and national confidence is being restored. M. Poincare strongly opposes further inflation. He proposes to borrow from the Bank of France on the security of uncollected revenues sufficient to meet the immediate liabilities of the State. Inspired quarters have lifted the veil off the Government's financial intentions sufficiently to indicate that the plan for the prorogation of Parliament for two years will not be adopted. On the contrary Parliament will probably sit until the middle of August and vote on a comprehensive series of measures which will involve an increase in taxation, direct and indirect, of from four to five milliard francs. Succession duties will figure largely in this taxation. The Government has ruled out the capital levy, a moratorium and fresh inflation. It will honour the debt agreements, though it will seek a modification of the Washington Convention with a view to the insertion of transfer and safeguard clauses.

Finally the stabilisation of the franc will be left until the exchange position has been remedied.

FRANC•IN LONDON. FURTHER RECOVERY. LATEST QUOTATION, 192. (Received 1.5 a.m.) Reuter. LONDON. July 26. The rate of exchange for the French franc in London this morning was 192 to the pound, compared with 197.75, the closing price on Saturday. There were some fluctuations, but no material change in the 6pening quotation.