BANKING POLICY.
EVIDENCE AT AUSTRALIAN INQUIRY. (Received This Day, 0.53 a.m.) MELBOURNE, February 13. Continuing his evidence before the Banking Commission to-day Mr. L. J. McConnen, chief manager of the National Bank of Australasia Ltd., claimed that the diversion of funds to savings banks had reduced the cash reserves of the trading banks and' the savings banks in turn had allowed a large part of their funds to lie on fixed deposit at the Commonwealth. Bank to the exclusion of the trading banks. He said that in a country like Australia the scope for influencing price levels by banking policy might be regarded as limited. From the feint of view of liquid reserves it would not be desirable to extend the use of Treasury bills. Any renewals of that policy might have an adverse effect on public confidence respecting the financial situation. However, should it be found desirable to increase cash reserves to the trading banka to meet a continuance of the present drain it would probably be preferable that some instrument other than Treasury Bills should be used, in which event the instrument should be far removed from the political sphere.
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Wairarapa Age, 14 February 1936, Page 5
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192BANKING POLICY. Wairarapa Age, 14 February 1936, Page 5
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