CHINESE EXCHANGE

Otago Daily Times, Issue 22720, 5 November 1935, Page 9

CHINESE EXCHANGE

PROTECTION OF BONDHOLDERS (British Official Wireless) RUGBY, November 2. (Received Nov. 4, at 5.5 p.m.) The Bank of England has taken steps to provide an organisation representative of British bondholders in Chinese Government railway and other loans, which will be in a position to negotiate with a view to the protection of their interests. The initiative has been taken as a precautionary measure in view of the unsettlement of the Chinese exchange due to the rise in the price of silver. THE CURRENCY RESERVES SHANGHAI, November 4. (Received Nov. 4, at 11 p.m.) In order to conserve the currency reserves the Government has established Government bank notes as legal tender. They will gradually supersede all others. The bank reserves will be under unified control and all holders of silver must exchange it for legal tender notes, the Chinese dollar being stabilised at its present level. The Central Bank will be reorganised as a Central Reserve Bank owned by the banks and the public. It will. not undertake general commercial business.

PLEDGE AGAINST INFLATION LONDON, November 4. (Received Nov. 4, at 11.15 p.m.) China’s decision to call in silver is described by the Financial Times as an achievement of the first magnitude. “ The world is given a memorable reminder that China, amid all her internal difficulties, is still capable of evolving great constructive plans. That she has lately received advice from a British expert does not alter the significance of the adoption of a new financial system which will conform broadly to that w'hich is serving this country so . well. A reduction of the dependence upon silver for internal circulation will provide a means of breaking free from internal price upsets and other evils which flowed from artificial interference with the world value of white metal by the United States. The Chinese Government undertakes to balance the Budget within 18 months and pledges itself against inflation.”