EXCHANGE REQUIREMENTS

Otago Daily Times, Issue 21982, 17 June 1933, Page 12

EXCHANGE REQUIREMENTS

STATEMENT BY MINISTER THE POSITION CLARIFIED (Per United Press Association.) WELLINGTON, June 16. "From various references in the newspapers there still appears to be some misapprehension as to the Government s exchange transaction,” stated the Minister of 'Finance (Mr J. G. Coates) to-day. “To make the position clear, I wish to state that the London exchange requirements of the Government for interest and other ordinary purposes for the last financial year were fully covered before the question of the raising of the exchange rate arose, and thus the only additional expense for 1932-33 arising out of the in-, crease in the rate was £470,000 for the purchase of surplus exchange under the Banks Indemnity (Exchange) Act. The amount of £1,910,000 so purchased was surplus to the requirements for the last financial year, and the apparent contradiction contained in a recent statement of mine to the effect that the funds taken over from the banks had not so far exceeded the amount needed to meet the Government’s ordinary interest requirements in London is explained by the fact that this latter statement had reference to the current financial year. The exchange that had been purchased under the Banks Indemnity (Exchange) Act will, of course, be used where necessary for meeting interest and other normal requirements in London, for obviously there is no need to make further remittances to London while funds are held in that centre. Needless to say, as the funds purchased pnder the exchange indemnity' arrangement are so used the necessary adjustments will be made in the public accounts.”