INTEREST RATES

Wanganui Chronicle, Volume 76, Issue 83, 8 April 1933, Page 13 (Supplement)

INTEREST RATES

The decision to reduce interest payable to depositors by savings banks, building societies and investment companies is part of the policy of forcing down interest rates to which the Goveminent is pledged. The policy is largely experimental, and only experience will determine whether it has been wise or not. It will bo generally admitted, however, that so long as the policy of compulsorily reducing interest obtains it must bo made as nearly universal in its applications as is feasible. The rate for Government and local body stocks having been reduced by means of legislation, it followed almost as a matter of course that investments in savings banks ami other financial institutions must be treated in the same way. The action which might cauM some surprise is the limitation of the rate of interest that is to be paid by the Public Trustee on investments ; n his common fund. Such investments often apply to beneficiaries in small estates, and the new rate of interest will be anything but welcome to those to whom a reduction of even ten shillings per cent, is of moment. The lowered returns for savings and investments arc in keeping with the Government’s determination tn ask all sections of the community to share tlic sacrifices demanded by the country’s financial position. They must be accepted in that, spirt and in the hope that indirectly the investors whose receipts are diminished will share in the benefits of .he reduction in costs of production that it is hoped cheaper money will bring about. —Taranaki Daily News.