CENTRAL BANK PROPOSED

Taranaki Daily News, 6 May 1931, Page 6

CENTRAL BANK PROPOSED

RECAST OF WHOLE SYSTEM ADVICE OF SIR OTTO NIEMEYER. CABINET TO CONSIDER REPORT. By TeloKraph.—Pr*4a AeSdsiation. Wellington, Last Night. The establishment of a central bank to control New Zealand’s ctodit is the chief recommendation rtiadfe by Sir Otto Nie i ineyer, A'ho recently investigated the banking, currency and exchange probleftis Of tfie Dominion and whose report has arrived from England. By this proposal Sir Otto recommends that the whole fabric Of NeW Zealand banking should be recast, and that important departures from pfesSht banking practice be made. Should tfiiS action be taken it is likely that the ■ new- institution, in conformity with the functions of other central banks, would assume the able right to issue paper currency'in the Dominion. It Wduld be free bi political control and dominance by the present commercial baflks. Sir Otto suggests that New Zealand should fall into line with other countries in order that the control of credit might be stabilised. Several other important recommendations concerning currency and exchange are made by Sir Otto, but these are mostly of a machinery character. The Whole report will shortly be considered by the Cabinet.