TRADE OUTLOOK

Wanganui Chronicle, Volume 79, Issue 29, 4 February 1935, Page 9

TRADE OUTLOOK

OPTIMISM IN BRITAIN PROSPECTS FOR THE YEAR. RECENT IMPROVED RESULTS. | Industrial Britain is facing the New Year in a spirit of restrained optimism. states a review of current condition®. The progress noted duing 1934 is likely to be maintained, on the whole, though three can be, of course, no expectation of anything in the nature of boom conditions, which are unlikely to develop until the world at large finds some means of promoting a freer flow of international trade, Relatively, however, the outlook in Great Britain is brighter than in any o'ther country, not excepting America. The chief grounds for cheerfulness the the marked recovery in industrial production, a great and steady decline in national unemployment, a strengthening of the prices of raw materialsand improved markets. The index of productive activity in Britain has at last reached the level which ruled during the comparatively prosperous years of 1928-29. This happy state of affairs has been reflected in substantial revenues. The Chancellor of the Exchequer is already able to count on his second successive surplus, and may even bo in a position to grant further taxation relief and resltore Public Service salaries to their normal standard, as well as to make generous provision for slum clearances and struggling industries. It is too early, however, to offer a reliable forecast in 'this connection, as the financial year has still three months to run. The only gloomy shades in an otherwise colourful picture are cast by the seemingly chronic economic depression in the “black areas,” whore the per-

centage of average unemployment sttiill reaches as high as 50, and in one or two tragic instances, 60. These “black areas” are the remnants of districts ruined through mines being worked out and by the catastrophic fall in the demand for coal. However, the Government has appointed a commission to revive old activities, create new ones, and. if necessary, transfer workless families to more prosperous scenes or to small allotment farms. There is undeniable proof that apart from this purely local “depression,” great strides have been made in the industrial sphere since 1932. The index of production for textiles was 94 for the first half of 1934, as against 90 in 1933. For chemicals it was 109, as against 101; for iron and steel, 104, as against 82; and for nonferrous metals, 130, as against 102. In 12 months to the end« of September employment had risen by 32,000 to 10.233,000, and is now higher than at any time, since September. 1029, th?, improvement covering practically every kind of trade. There is a certain significance, too, in the fact that the Stock Exchange is looking forward tto a busy year. Money as expected to continue cheap, with inevitable appreciating effect on gilt-edged securities and similar stocks. With gilt-edged prices high t.ho yield on practically all classes of other securities will tend to contract and prices to rise.