EXCHANGE RATE LEVEL.

New Zealand Herald, Volume LXIX, Issue 21100, 6 February 1932, Page 8

EXCHANGE RATE LEVEL.

QUESTION OF ALTERATION. DISCUSSIONS WITH BANKS. EARLY DECISION EXPECTED. EFFECT UPON TAXATION. [B\ TELE'IEAPH.— press association.] CHRISTCHURCH, Friday. "The banks have made a definite decision on the question of the exchange credits pool, maintaining that the exchange rate of 10 per cent, on the present balance in London is a fair rate. Whether they will agree that the rate should be raised is a matter for discussion, and no doubt during the coming week we shall see if any alteration can be made." This statement on the exchange question was made this evening by the Prime Minister, the lit. Hon. G. W. Forbes. The Prime Minister stated that the question of the exchange rate and the points raised by the representatives of the primary producers and of the Associated Chambers of Commerce were still matters for discussion between the banks and the Government. The question was whether the present exchange rate of 10 per cent, was a fair one. Representations made to _ the Government by those who thought this rate not fair had been passed on to the banks and discussion was now proceeding on that angle. Mr. Forbes emphasised that the height of the exchange rate was a matter to be decided by the banks and not by the Government, which had no control over the ruling rate. "The present rate -of 10 per cent.," said Mr. Forbes, "means that the Government will be called upon to find an extra £1,200,000 not provided for in the Budget. How that can be provided without more taxation is a difficulty to be considered. If the rate goes higher, an even greater sum must be found. "With taxation standing as it is today, every additional million that has to be raised in revenue is a matter for serious consideration."