FRANC DEVALUED

New Zealand Herald, Volume 82, Issue 25395, 27 December 1945, Page 7

FRANC DEVALUED

BATED AT HALFPENNY ALIGNMENT OF CURRENCY PARIS, Dec. 25 The official announcement was made today that the French franc has been devalued to the new rate of 480 to the English pound sterling and 119.10669 to the American dollar. (The franc is thus worth one English halfpenny.)

The French Government considered the economic situation of each overseas territory and decided to modify the value of currency in certain colonies in relation to metropolitan France. In the Pacific colonies, including New Caledonia, New Hebrides and the rest of French Oceania, 100 local francs are made equal to 240 metropolitan francs, and thus are exchangeable at 200 for the English pound sterling and 49.627 for the American dollar respectively. The foreign currency resources of territories inside the franc zone will be pooled as hitherto through an exchange stabilisation fund. There is no change of the regulations affecting transfers between'different territories of the franc zone.

The devaluation of the franc will take effect with publication of the announcement tomorrow morning in the Government official journal. The Paris Bourse and the provincial Stock Exchanges are closing tomorrow because of the decree. It is stated that devaluation was decided upon in order to align French currency more closely to its actual value in comparison with world moneys on the eve of the Constituent Assembly's meeting tomorrow, to undertake ratification of the Bretton Woods agreement.

The value of the franc in 1914 was 25.22 to the pound. In 1940 it was 17Gi to the pound and in 1944 (after D Day) it had fallen to 200 to the pound.