NEW ZEALAND FINANCE.

New Zealand Herald, Volume LXVIII, Issue 20965, 31 August 1931, Page 9

NEW ZEALAND FINANCE.

TREASURY BILLS IN LONDON. "EXCELLENT TERMS." (Received August 30, 5.5 p.m.) LONDON. August 29. Treasury bills to the amount of £650,000, with a currency of three months, have been placed on behalf of the New Zealand Government. The bulk of the amount was placed at £4 4s per cent, discount. The money market considers New Zealand has got excellent terms as the price at which British Treasury bills were allotted yesterday was £4 3s 1.!, d per cent. Current revenue is normally considerably less than expenditure during the first nine months of the financial year, and since the accumulated balance in the Consolidated Fund has been exhausted by successive deficits in the annual accounts, temporary finance by short-term borrowing is necessary. During 1930-31, the Government issued £2,950,000 of bills in New Zealand and London for this purpose, the London issues amounting to £750,000 at rates varying irom £2 3s 9d to £2 6s 3d per cent. All these bills as well as the local issues were paid off before the end of the year. The only public announcement' of these issues was in respect of £600,000 of the bills placed at tho end of November at £2 3s 9d per cent. At that date the weekly allotment of British Treasury bills was made at an average of £2 2s lid per cent. The rise in the rate for British bills to £4 3s lid per cent, last week is another illustration of the transformation in monetary conditions in the last two months. On May 22. the allotments were made at an average rate of £1 19s 11.95 d ; on June 26, the rate was £1 19s 9.87 d and on July 3, it was £1 18s 3.45 d. A fortnight iater, the rate had risen to £2 7s 5.17 d, this being the latest date for which mail advices are available.