MONEY DRIFTING

Poverty Bay Herald, Volume LXIII, Issue 18992, 17 April 1936, Page 2

MONEY DRIFTING

INVESTED IN AUSTRALIA CURRENCY LEAVING N.Z. Some comment has been made in New Zealand on Ihe drift of money from the country for . investment, elsewhere. A Napier firm has received information on Ibe subject from a Melbourne stock and share brokers' firm. "Statements in the press have been made that the financial policy of the Savage Ministry has caused alarm, and that despite reassuring statements made. capital has been quietly leaving the Dominion," stales the report. "Investors in New Zealand have been apprehensive regarding the proposals of the Ministry —amongst others, that to institute shorter working hours-, which might be expected to have the effect of increasing overhead cosfs in industry. CONTROL OF CURRENCY "Investors also fear the proposals of (he Ministry to control < urrency and credit and handle dairy products -exports. The effect, of official announcements has been indicated by the fall in prices of New Zealand industrial shares. "The weakness of the market, in New Zealand and the comparative steadiness of the Australian share market have naturally caused investors to review their position', and a. small, bnf steady, flow of capital from New Zealand to Australia has been taking place. "T( is expected thai this movement will develop and (hat- more funds from (he Dominion will be seeking an outlet on the Australian market. In a. recent statement, on exchange. Mr. Savage said that no reduction in the exchange rale was contemplated for the immediate future. He admitted that, many difficulties would have to he overcome before a reduction in the rale of £125 New Zealand for .CIOO in London could be effected.

"New Zealand investors have not been slow to recognise the possibilities offered by the Australian market, and the recovery that has already occurred in Australia suggests that they may safely consider placing funds in lending industrial shares in Australia."