RESERVE BANK

Wanganui Chronicle, Volume 84, Issue 86, 13 April 1940, Page 3

RESERVE BANK

DECREASE IN STERLING EXCHANGE NOTE ISSUE LOWER A decrease of £108,697 brings the sterling exchange funds of the Reserve Bank of New Zealand down to £12,599,193. The note issue at £18,074,976 shows a further decrease of £175,118. Dairy advances are down by £123,316, while advances to the State for other purposes are unchanged. The statement of assets and liabilities of the Reserve Bank as at the close of business on Monday, April 8, is as follows: Liabilities. £ s. d. 1. General Res. fund 1,500,000 0 0 2. Bank notes 18,074,976 10 0 3. Demand liabilities—<a> State 6,333,810 0 8 - Banks 14,541,771 10 8 «c» Other 314,998 14 3 4 Time deposits 5. Liabilities in currencies other than ?\.Z. currencx 8,736 19 2 6. Other liabilities ... 930,817 1 3 £(N.Z. >41,705,110 16 0 Assets. 7. Reserve— £ s. d. (a) Gold 2,801.839 0 0 *(b) Sterling exchange 12,599,193 0 8 (c) Golu exchange 8. Subsidiary coin 160,964 5 0 9. Discounts—(a) Commercial and agricultural bills (b) Treasury and local body bills —— 10. Advances—(a) To the State or State undertakings: (1) Marketing Dept. 3,528,397 15 4 (2) For other purposes 19,310,000 0 0 (b) To other public authorities (c) Other 11. Investments 3,063.643 7 9 12. Bank buildings 13. Other assets ~ 241,073 7 3 £(N.Z.)41,705,110 16 0 "Expressed in N.Z. currency. Proportion of reserve (No. 7 less No. 5», to notes and other demand liabilities. 39.2 per cent., compared with 39.224 per cent, on April 1. The reserve on Monday amounted to £15,392,295, compared with £15,502,615 on April 1, a decrease of £110,320. A year ago the reserve was £7,356,354, and on April 11, 1938, it totalled £19,871,865. Sterling exchange, expressed in New Zealand currency, on Monday, amounted to £12,599,193, compared with £12,707,890 on April 1, a decrease of £108,697. Liabilities in currencies other than New Zealand currency on Monday totalled £8737 (an increase of £1624), thus making the bank’s net overseas assets £12,590.456. compared with £12,700,776 on April 1, a decrease of £110,320. A year ago the bank’s net overseas assets were £4.554.564, and on April 11, 1938, they totalled £17,070,074. Gold reserve remains unchanged at £2,801.839. Subsidiary coin totals £160.964, an increase of £715. Advances to the State Marketing Department on Monday totalled £3,528,398, compared with £3,651,713 on April 1, a decrease of £123,316. A year ago these advances amounted to £7.497,177. Advances to the State for other purposes remain unchanged at £19.310.000. A year ago these advances were £ll,975,000. Investments total £3,063,643, a decrease of £8275. Other assets total £241,073, a decrease of £11,501. The note issue on Monday stood at £18,074,976. a decrease of £175,118. A • < note sue was £15,457,~Demand liabilities to the State 0, a further decrease of £63,899. The trading banks’ reserve balances show a decrease of £113,324. and now total £14.541,771. Other demand liabilities amount to £314.999. an increase of £94,902. Other liabilities total £930,817, a further increase of £4743. The statement balances at £41,705,111, a decrease of £251.072. .Movements in Sterling Exchange. The movements in the sterling exchange held by the Reserve Bank of New Zealand and in the ratio percentage of reserves to notes and other demand liabilities, are shown in the following table:—

The statutory minimum of the reserve ratio is 25 per cent.

Sterling Reserve exchange ratio 1937. (£N.Z.) per cent. December 27 .. 16,992,748 70.323 1938. August 29 13,695,000 67.2 September 26 11,449,447 60.785 October 31 7.707,697 46.09 November 28 — 4,828,302 32.685 December 26 4.678,233 27.882 1939. January 30 4,133.586 25. fb February 27 4,839,555 25.799 March 27 4,659,874 25.419 April 24 4,629,061 25.11 May 29 4,564,206 25.136 June 26 5,600,692 30.249 July 31 5,576,957 28.132 October 30 5,743,087 25.367 November 20 7.543.770 30.624 November 27 6,624,585 28.477 December 4 5,961,673 26.634 December 25 8,717,735 32.200 1940. Januarv 1 - 7,036,750 27.947 January 29 8,725,720 30.508 February 5 9,242,501 31.588 February 26 10,842,600 32.812 March 4 10,020,871 32.377 March 25 13,033.980 40.401 April 1 12,707,890 39.224 April 8 12.599,193 39.2