EXCHANGE RATE

Poverty Bay Herald, Volume LX, Issue 18067, 19 April 1933, Page 12

EXCHANGE RATE

WILL IT BE RAISED 1 STATEMENT BY MINISTER “The Government docs not contemplate any further increase in the rate of exchange on London as a matter ot economic adjustment, but as the world situation is still obscure no definite commitment can be made in regard to the future.” This statement is co'ii ta’ined in a letter on the exchange position signed by the Minister oi Finance, the Rt. lion. J. G. Contes and received by- the vice-president of the Auckland Chamber of Commerce, states the Star. “As it is impossible to foresee the future course of events,” continues the letter, ‘‘the Government obvious ly cannot give any undertaking ns to what action may be necessary in the interests of the Dominion. In the meantime, however, it is pointed out that the Banks Indemnity Exchange Act refers only to transactions at the current rate of exchange or at rates intermediate between the current rate and the former rate of 10 per cent. It makes no provision for any rate above the present rates of exchange . ‘‘Apart altogether from the fixation of the rate as a matter of economic adjustment, it is pointed out that if owing to further heavy falls in the volume of the Dominion’s exports or for any other reason the balance of trade becomes heavily adverse, it might be necessary from a purely banking standpoint to furtliei increase the rate of exchange. In suclr a case, however, there would be no question of any Government guarantee, for that would obviously not be necessary. At the same time, ms in the past, it would probably not ‘be feasible to give any notice of the change in the rates. At present however, the trade balance is satisfactory-, and no increase in the exchange rates' on this account need be feared. ”