AUSTRALIAN POUND

Otago Daily Times, Issue 27510, 3 October 1950, Page 5

AUSTRALIAN POUND

Appreciation To Defeat

Inflation MR R. G. CASEY’S VIEWS SYDNEY, Oct. 2. The Federal Minister of Development, Mr R. G. Casey, who strongly favours some measure of appreciation of the Australian £, said last night that inflation was an ally of world Communism. Mr Casey added that Moscow had timed its drive against the democracies to correspond with the inflationary trend, and they did this in the knowledge that the efforts of the democracies to rearm and strengthen themselves by military preparedness would tend further to increase inflation. The Victorian Institute of Public Affairs has prepared,an 11-point plan to check Australian inflation. Its main provisions are the appreciation of the Australian £ by 10 per cent., the freezing of part of the wool receipts on a temporary basis, subsidisation of local woollen manufacturers, and tha elimination of unnecessary expenditure. Country Party Opposed Writing in the Sydney Daily Telegraph, Mr M. F. Bruxner, leader of the Country Party of New South Wales, says: “The primary industries, particularly those concerned with export trade, would consider revaluation in a different light if they could be sure that all the effects of revaluation would be allowed to run their full course. The results that would be most directly felt and understood by the mass of the people would be a 20 per cent, fall in the return from our export commodities and a 20 per cent, fall in the cost of all imported goods. But would manufacturers and trade unions swallow the medicine coming to them through revaluation? The chances are nil. There would be a rush to the Tariff Board for an increase in Customs duties to offset the effect of revaluation, and only a brave man would predict that, the Tariff Board, after hearing evidence, would not grant the protection asked." Canadian Decison “ Obviously the Canadians feel so confident about the strength of their dollar that they are prepared to frea it on the open market,” says the Sydney Daily Telegraph. “ But what about the Australian £? It is worth more than the British £, yet its fixed exchange rate is still 25 per cent, less than sterling. On the strength of our tremendous export income, and as a means of stabilising Australian economy and reducing the cost of living, we should ignore the propaganda babble of sectional interests and revalue our £ now.”